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3MM 84 ANNUAL REPORT • 2019 REPORT ANNUAL 210X297 2 019 COVER THE ROYAL BRITISH LEGION BRITISH ROYAL THE YEAR ENDED 30 SEPTEMBER YEAR ENDED ROYAL BRITISH LEGION ROYAL ANNUAL REPORT & ACCOUNTS REPORT ANNUAL

THE ROYAL BRITISH LEGION ANNUAL REPORT & ACCOUNTS 2019 Cover.indd 1 Contents.indd 2 04/06/2020 16:19

ROYAL BRITISH LEGION ANNUAL REPORT • 2019 CONTENTS 210X297 84 3MM CONTENTS

FOREWORD P4

TRUSTEES’ REPORT P6

INDEPENDENT AUDITOR’S REPORT P50

STATEMENTS OF FINANCIAL ACTIVITIES P52

BALANCE SHEETS P54

CASH FLOW STATEMENTS P55

NOTES TO THE ACCOUNTS P56

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 CONTENTS 210X297 84 3MM FOREWORD

the fallen. Voice recordings of veterans from the Imperial War Museum’s archive played as the audience stood in silence holding photos of Service personnel from the First World War who never came home. We were delighted when the Festival won its first-ever BAFTA, for Best Live Event. Driven by huge public interest stimulated by commemorations of the end of the First World War, the Poppy Appeal that began in 2018 and closed in 2019 raised almost £55 million, more than any appeal in our history. Once again, we are genuinely humbled by the support we receive and the dedication of our members and volunteers, both during the Poppy Appeal and throughout the year. UNA CLEMINSON, National Chairman and CHARLES BYRNE, Director General While it has been uplifting to see so many people from different backgrounds and nationalities brought together at our events, we do not forget A year that saw the 75th anniversary people from different backgrounds unite those who feel isolated. Social isolation commemorations of the D-Day landings, in Remembrance at events in Boston is an issue across our society, but recent along with several major battles of the and Leicester. We brought different research shows that it is particularly Second World War, was always going generations together, too. In schools prevalent among those in the Armed to be a busy one for the Legion. across England, Wales and Northern Forces community. More than 900 ‘Remember Together’ was our theme Ireland, educational materials were branches take part in our community- for Remembrance this year, yet the made available to 1,906,000 children support initiative, which has reached inclusion it calls for was also a guiding so they could learn about and better more than 4,000 people this year. principle. We chartered a ship, MV understand Remembrance. The initiative provides much-needed Boudicca, to carry 275 D-Day veterans Other conflicts beyond the Second assistance to those who are socially plus their family members and carers to World War were also commemorated isolated, from things such as home the beaches of Normandy. We brought this year. We were proud to recognise visits to help with moving house. people of many different nations the commitment of the many people Turning to the future, we are very together for an international ceremony who served in Operation Banner, the much looking forward to next year’s in Portsmouth led by HM The Queen. Army’s deployment in Northern Ireland Together at Christmas initiative. To honour those who served, we from 1969 to 2007, Britain’s longest- Launching with the support of four organised a service at Bayeux Cathedral, ever continuous operation. generations of the Royal Family, as well as commemorations at the The 2018 Festival of Remembrance including HM The Queen, the initiative Commonwealth War Graves Commission commemorated the centenary of the end will see us distributing special Legion cemetery in Bayeux and the National of the First World War and was one of Christmas puddings across our branch Memorial Arboretum. Country leaders, the most powerful we can recall. A network in time for our Christmas 2020 communities and individuals all particularly haunting and beautiful get-togethers. The aim is to combat the gathered to pay tribute to those who moment came when Sheku Kanneh- social isolation felt by some members of fought at Monte Cassino, Kohima and Mason, a world-class cellist, played the Armed Forces community at a difficult Imphal. We worked with the social- Leonard Cohen’s Hallelujah as a gauze time of year for those on their own. inclusion charity British Future to help came down displaying photographs of It’s important to us that everyone’s

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 FOREWORD 210X297 84 3MM voices are heard. Our Count Them In to the Charity Commission and our mobility. The average expenditure campaign has been hugely successful, many regulators. We have provided per household through the Legion’s and we’re confident we’ll see a question the Board of Trustees with development immediate-needs funding has risen concerning membership of the Armed sessions addressing risk and 48 per cent – from £900 to £1,330 Forces community included in the next safeguarding. In last year’s report, – over the same period. As with other national census. This will enable both we commented on breaking down the military charities across the board, the national and local government, charities barriers between department silos Legion will continue to face income and other service providers to draw in the Legion. We’ve taken steps to and cost pressures, which will need upon data to help them plan, tailor and improve this, but it’s still not as good as to be managed effectively. deliver services that meet the needs of it needs to be. Making the organisation In 2020, the Covid-19 pandemic the Armed Forces community. We were work together more seamlessly is one has significantly disrupted our way also delighted to see Susan Coleman, of the goals of the new operating model of life across our nations and our Equality & Diversity Champion, due for launch in 2020. communities, and has affected us all. win the Defence Inclusivity Award at The year saw two changes in our We will continue to play our part in the 2019 Soldiering On Awards for leadership team. We are delighted to the nation’s response, adapting how her role in supporting the LGBTQ+ welcome our new National President, we work so we can continue to help community. On Commonwealth Day, James Bashall, and our first female those we support throughout these we launched our Stop the Service National Chairman, Una Cleminson. extremely challenging times. Charge campaign to scrap visa fees We would like to wish them both the The heart of the Legion, our work for Commonwealth personnel and their best of luck and have every confidence and our vision, is summed up in The families when applying for indefinite they will make a great contribution Charge, which we hear whenever leave to remain in the UK following four during their tenures. a President hands over the Standard years of Service or more. The campaign They take up their roles at a time to a new Standard Bearer. “The gained national media coverage and when the Legion faces big challenges. Union flag, in the top left-hand corner, the support of more than a quarter of Despite the population we serve is symbolic of our unity and our MPs and the Ministry of Defence. decreasing, we continue to see loyalty to the Crown, community and Good governance is one of the most increasing requests for support. A large nation.” Those words express the important factors in ensuring the sound proportion of our beneficiary community essence of who we are and what we operation of a charity and protecting is getting older and, as a result, have do. The Legion, in bringing together its reputation, so we have strengthened more needs than in previous years. people of different nations and our governance with a more defined Since 2016, we have seen a 20 per communities from across the world, framework. It makes clear which cent increase in people needing basic continues to be a powerful force for responsibilities sit where and how support with housing, financial issues, good, something that has never been incidents must be recorded and reported mental health and wellbeing, and more important.

“ONCE AGAIN, WE ARE GENUINELY UNA CLEMINSON HUMBLED BY THE SUPPORT WE National Chairman RECEIVE AND THE DEDICATION OF OUR MEMBERS AND VOLUNTEERS, BOTH DURING THE POPPY APPEAL

AND THROUGHOUT THE YEAR” CHARLES BYRNE Director General

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 FOREWORD 210X297 84 3MM TRUSTEES’ REPORT

The trustees present their report, including strategic review, and the audited financial statements for the year ended 30 September 2019 FINANCIAL OVERVIEW 8 WHERE THE MONEY COMES FROM £ Million % 6 7 1 The Poppy Appeal 55.0 31.3 2 Donations, legacies and events 49.9 28.4 5 3 Lotteries and trading 20.4 11.6 1 4 Fees charged to Care Home residents 17.1 9.7 Total 5 Grants for welfare services and Remembrance 22.1 12.6 4 6 Membership subscriptions 4.4 2.5 £175.9M 7 Investment income 6.6 3.8 3 8 Other 0.4 0.2 TOTAL INCOME 175.9 100 2

WHERE THE MONEY GOES 1 Operational costs 9 £ Million % 8 2 1 The Poppy Appeal 14.2 7.8 Donations, legacies and events 14.6 8.0 3 2 Total 3 Lotteries and trading 14.3 7.9 4 Remembrance 14.8 8.1 £181.7M 4 5 Comradeship 0.6 0.3 7 6 Care Homes and Break Centres 37.7 20.7 5 7 Welfare services 63.7 35.1 6 8 Membership 9.0 5.0 9 Communication and campaigns 12.8 7.0 TOTAL OPERATIONAL COSTS 181.7 100

4 WHERE THE MONEY GOES 1 Capital costs £ Million % Total 1 Care Homes and Break Centres 2.2 28.1 2 The National Memorial Arboretum development 1.0 12.4 £7.9M 3 Improving IT infrastructure 4.1 52.3 3 2 4 Other 0.6 7.2 TOTAL CAPITAL COSTS 7.9 100

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 FINANCIAL OVERVIEW 210X297 84 3MM TRUSTEES’ REPORT

FUNDS & RESERVES

The total funds of the RBL group are broken down into three categories: Not available to spend, Membership funds and Restricted spend, and Unrestricted funds available to spend.

NOT AVAILABLE TO SPEND

Our operational buildings, such as Care Homes, our offices and the NMA £101.2m

Branch properties occupied ROYAL BRITISH LEGION by Legion clubs £65.0m

Interest-free loans to beneficiaries £4.9m

Subtotal of funds Not available to spend: £171.1m

MEMBERSHIP FUNDS AND RESTRICTED SPEND

Membership funds, including £44.8m money held by branches

Money that can only be used in a £64.7m specific geographical area

Money given to us for a £24.5m specific purpose

Subtotal of Membership funds and Restricted spend: £134m

UNRESTRICTED FUNDS AVAILABLE TO SPEND

Reserves set aside £55m for emergencies

Money we have available to spend £11.7m

Subtotal of Unrestricted funds available to spend: £66.7m

TOTAL FUNDS £371.8M

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THE ROYALROYAL BRITISH BRITISH LEGION LEGION ANNUALANNUAL REPORT REPORT 2018 • 2019 INFOGRAPHICRESERVES 210X297210X297 84 84 3MM Elaine Mascurine, Advice and Information Offi cer, East Anglia & Essex

SERVICES AND SUPPORT

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 SERVICES & SUPPORT 210X297 84 3MM TRUSTEES’ REPORT

SERVICES AND SUPPORT

Architect’s impression of the new Hub at Galanos House, which will open in spring 2020

Our purpose is to provide personalised analysis as well as review our grant- of internal and external studies and support to members of the Armed giving programme. With the insights collaboration with our wide network Forces community, which includes those gained, we would focus our activities of partners. who are currently serving, veterans, where they were most needed. To We have already begun to connect their partners and dependants. This further support those in need, we our services better so people coming to enduring support can start after the first planned to complete the Galanos House us for help experience a single, joined- day of Service and continues through Care Home community hub, building life, well after Service ends. and opening the facility. Finally, we Value for money is important. We pledged to put on a sports recovery want to achieve the maximum benefit event at the UK National Trials in from each pound we spend. Our plans collaboration with the Ministry of IN ORDER for this year, set out in last year’s report, Defence (MoD) and Help for Heroes. were focused on ensuring that the Although the overall number of TO MAKE A services we provide meet the changing households we helped this year is needs of the Armed Forces community. comparable to last year, people’s needs LASTING, POSITIVE We wanted to connect up our individual are becoming increasingly complex. services better so that those in need, Many are coming to us at their lowest DIFFERENCE TO no matter how they come to us, would point, at risk of homelessness or unable THE PEOPLE WE have the most seamless, person-centred to feed their families. In order to make support possible. That’s why we a lasting, positive difference to the SUPPORT, WE promised to invest in our helpline people we support, we therefore have operation, ensuring our teams had the to adapt our services. Over the year, HAVE TO ADAPT resources and skills they needed to we have increased our understanding have the greatest impact they could. of this changing need in the Armed OUR SERVICES We planned to develop our data Forces community through a combination

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 SERVICES & SUPPORT 210X297 84 3MM TRUSTEES’ REPORT

SERVICES AND SUPPORT

up service. We have also changed the We helped more than 1,300 way we measure the performance veterans who acquired hearing loss of our call centre to focus on quality or tinnitus during Service, with grants 2019 WAS over quantity. totalling £4.9 million. By providing Work on the community hub at equipment, including specialist, THE VETERANS Galanos, and its ten-bed extension, state-of-the-art hearing aids and an progressed well this year. We will array of Bluetooth devices, we helped MEDICAL FUNDS be completing both projects in 2020. the veterans and their families live fuller PROGRAMME’S and more comfortable lives. A further VETERANS MEDICAL FUNDS 67 veterans with serious physical MOST POPULAR In December 2015, we launched the injuries attributed to Service received Veterans Medical Funds programme grants totalling £500,000 for AND SUCCESSFUL to help meet the specific health physiotherapy, wheelchairs, braces needs that many veterans have. This and other equipment. PERIOD SINCE programme is funded by a five-year, IT BEGAN £13 million commitment from Her COMMUNITY SUPPORT Majesty’s Treasury, using income We know that social isolation is generated from the LIBOR rate-fixing a real issue among the Armed Forces fines. We are pleased to say that 2019 community. Our community support was the programme’s most popular initiative, run by our branches, provides much-needed help, including home and successful period since it began. those who are socially isolated with visits and even assistance moving house. The initiative goes from strength to strength and branch members have provided support for more than 4,000 people this year. A total of 932 branches have now signed up to the scheme and between them have undertaken some 10,500 visits.

INVICTUS GAMES There is growing awareness that participation in adaptive sports can bring profound change for the better in veterans who have suffered disability in Service. As there was no international Invictus Games in 2019, the UK ran its own national event, the Invictus UK Trials, which took place between 22 and 26 July 2019. We wanted to bring the benefits to as many British wounded, injured or sick personnel – serving and veteran – and their families as we could, and a total of 324 competitors attended the Trials with our support. The event also saw the first-ever UK Veterans Arts Festival, incorporating Duncan Maile, Regional Outreach Officer music, poetry, painting, photography, literary writing, dance and theatre.

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 SERVICES & SUPPORT 210X297 84 3MM TRUSTEES’ REPORT

FUNDING OUR PARTNERS’ EXPERTISE

There are hundreds of Armed Forces charities. As the largest, we feel a responsibility to make it as easy as possible for members of the Armed Forces community to find the specialist services that could help them most. We also help to sustain those services through funding. Our external grants programme helped more than 24,000 people across the UK over the year. In order to make the greatest impact possible with this funding, we are reviewing it to ensure we direct funds at areas of unmet need. This new funding programme will open in 2020. Here are some examples of the many different ways in which we worked with partner organisations in 2019.

READING FORCE Reading Force’s aim is to help families with a Service connection to better communicate with one another. It provides free books and special scrapbooks to encourage families to set up informal book groups, which help families stay connected or reconnect.

VETERANS LEGAL LINK Veterans Legal Link (VLL) offers lawyers and Aberystwyth University law students Competitors in the the chance to give something back. Invictus UK Trials They use their skills to bring justice to veterans and their families in need throughout Wales. The law students for the Armed Forces is dedicated to NEW CHALLENGES WITH MORE improve access to justice by providing helping people affected by spinal cord COMPLEX NEEDS a comprehensive signposting and injury. Access to the service is open to The trend of people coming to us with referral service. both current and former members of the ever-more complex needs continues to Armed Forces, their families and carers. present challenges. We spend more SPINAL INJURIES ASSOCIATION resources per household we help The Association’s Peer Support Service because the support we now provide

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 SERVICES & SUPPORT 210X297 84 3MM TRUSTEES’ REPORT

have closely considered all options for Veteran Maurilia Simpson, our organisation to identify where we Lance Corporal, Royal Logistics Corps can make the greatest difference to those tackling the toughest challenges. As a result, we have had to make some difficult decisions. Although it falls outside of the reporting period covered in this report, we feel it important to announce that we will be closing our breaks and home-maintenance services in 2020. While we know these services were well loved, their closure will release £5.8 million annually. The funds will provide increased resource for casework; immediate-needs funding, including crisis grants; investment in our Care Homes and services for older members of the Armed Forces community; and funding to external partners.

AIMS FOR 2020

Improve the experience of people using our services by partnering in the development and launch of a new Casework Management System (CMS), to be used by more than 90 Armed Forces-linked charities Make further changes to how we manage cases based on previous review findings and our learnings from delivering support during the Covid-19 pandemic Respond with better support to the increased prevalence of multiple- needs cases Help Team UK competitors and families is more holistic, involving more staff a review and change programme for in their preparations for the next resources and access to multiple our sector-leading War Pensions and international Invictus Games in 2021 services. The financial costs of grant Armed Forces Compensation scheme. Develop a future strategy for provision have therefore increased. It enables members of our community to Recovery following the conclusion We are not alone in the Armed Forces access compensation for Service-related of the MoD’s review of the Defence charity sector in seeing an increase injury and illness. Recovery Capability in the complexity of need, but we are The modern-day needs of the Armed determined to meet this challenge. Forces community are changing and it During the year, we completed is our duty to change in response. We

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 SERVICES & SUPPORT 210X297 84 3MM TRUSTEES’ REPORT 2019 IN NUMBERS In 2019, we marked the centenary of the end of the First World War, while our services and support and campaigning efforts reached new heights

INVICTUS

GAMES

183,298 enquiries have been made to our helpline We helped 685 wounded, injured and using phone, email and sick personnel with recovery support through live-chat channels the Invictus Games and the Battle Back Centre

£15.9 million

104, 975

visitors came to our Pop In The Royal British Legion Centres, where they were given provided people with face-to-face support financial support that equalled £15.9 million

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THE ROYALROYAL BRITISH BRITISH LEGION LEGION ANNUALANNUAL REPORT REPORT 2018 • 2019 INFOGRAPHICINFOGRAPHICS 210X297210X297 84 84 3MM TRUSTEES’ REPORT

We helped more than 1,300 veterans who acquired hearing loss or tinnitus during Service, with grants totalling £4.9 million 1,300 1,161 new carers for people living with dementia are now supported by the Legion

Our external grants programme made grants to other organisations totalling £12.7 million, helping more than 30,000 people

255veterans and their family members were carried across the Channel to Normandy on a ship chartered by the Legion to mark the 75th anniversary of D-Day

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ROYALTHE BRITISH ROYAL BRITISHLEGION LEGION ANNUALANNUAL REPORT REPORT • 2019 2018 INFOGRAPHICSINFOGRAPHIC 210X297210X297 84 84 3MM 342,186 people participated in daily acts of Remembrance, guided walks, buggy tours, exhibitions, events and activities across the National Memorial Arboretum site

10,500 members provided support for more than 4,000 people this year. people attended the National Memorial A total of 932 branches signed Arboretum’s largest-ever Armistice up to our community support service, marking the centenary of the end of the scheme and between them have First World War facilitated some 10,500 visits.

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THE ROYALROYAL BRITISH BRITISH LEGION LEGION ANNUALANNUAL REPORT REPORT 2018 • 2019 INFOGRAPHICINFOGRAPHICS 210X297210X297 84 84 3MM TRUSTEES’ REPORT £55 million The 2018 Poppy Appeal raised £55 themillion largest, amount in our history. It was accomplished by extending the reach of the Thank You campaign, with around 500 community events 40 million For the 2018 Poppy Appeal, we distributed roughly 40 million poppies, 7 million pin badges and 27,000 school packs

Our final response to the consultation on the 10-year Veterans Strategy contained 136 recommendations for practical ways that the UK Government, and society at all levels, can improve services and support for our veteran community

136 The Festival of Remembrance won a BAFTA for Best Live Event

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ROYALTHE BRITISH ROYAL BRITISHLEGION LEGION ANNUALANNUAL REPORT REPORT • 2019 2018 INFOGRAPHICSINFOGRAPHIC 210X297210X297 84 84 3MM AMBASSADOR STORIES

“I FEEL SO DIFFERENT – THERE’S NO NEGATIVITY AND NO PROBLEMS. I CAN NEVER THANK DAVE AND THE LEGION ENOUGH FOR EVERYTHING THEY’VE DONE”

spiral downwards after that. I had some messaged him at daft times,” says David. DAVID STREET strong days when I felt positive and “Although I’m ex-Armed Forces, I just could do anything, but then I’d go for didn’t see myself as a veteran, because ROYAL NAVY VETERAN FULL OFweeks without being able to set foot I’d only served two years and didn’t think PRAISE FOR LEGION VOLUNTEERoutside, I was so depressed.” I had any entitlement, but the response David Street, 37, hit rock bottom Following an online search for help, from the Legion has been unbelievable.” after leaving the Royal Navy. Having David found himself at The Royal British Now, in a remarkable turnaround, served his country for two years, David Legion’s Pop-In centre in Liverpool. David has landed a job as an electrical- encountered unexpected challenges Here, he found a friend in the form of fault finder and also works as a on his return to civilian life. A broken volunteer caseworker Dave Wakelam. handyman in Walton during his spare relationship, a custody battle, a pile Dave and the Legion helped David time, having put fliers through doors in of debts, a period of unemployment, to find a place to live and paid for his neighbourhood. He is now settled social isolation and a notice of eviction essential furnishings for the flat. David in his flat with his new job and a new created a nightmare of circumstances was also appointed a dedicated relationship with girlfriend Jo, along for the veteran. Benefits, Debt and Money advisor with a newfound confidence. “Things took a nosedive after I left to help sort out his finances. He has since joined veterans’ the Royal Navy,” he recalls. “I lost the “It’s like having a family I never knew networks through the Legion and finds married quarters after the end of my I had – nothing has been too much the support of other ex-Royal Navy marriage and everything seemed to trouble for Dave, even when I’ve personnel invaluable.

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AMBASSADOR STORIES

about what I wanted to do next,” she what I needed to release all the pain and BETHANY says. Bethany was referred to the disappointment I had gone through Legion-funded Battle Back course for the and start to focus on the future.” WILLIS injured, sick and wounded to help with Since Battle Back, Bethany, from physical and mental-health recovery. Suffolk, has set herself up as a personal LEGION-FUNDED BATTLE “The week was a game-changer for trainer and, although she still endures BACK CENTRE HELPS me. My mindset changed, I began to pain in her back, she is determined to PERSONAL TRAINER FIND focus on myself and what I wanted and help others achieve their health goals. RENEWED PURPOSE come to terms with what had happened,” “I owe a lot to the Legion, so each At 26, Bethany was in the process she says. “It was a very refreshing Remembrance I arrange a physical- of being discharged from the Army, approach [compared] to what I had challenge fundraiser and donate the following an injury. She had been an encountered before, and combining the money to the Legion – now knowing that England footballer in her teens before activities such as wheelchair basketball this money can help others in my position joining the Service to realise her dream with group and one-to-one talks was get back on their feet,” she says. of becoming a personal trainer. While on a training exercise for extracting casualties, Bethany felt a sudden pain in her back. In a matter of days, she was in agony when running and could no longer play football. Doctors couldn’t pinpoint the cause of her injury and, despite a prescription of painkillers and rehab, Bethany was unable to continue with her dream job. “I was very low and felt quite lost

“I WAS AROUND PEOPLE WHO WERE GOING THROUGH SIMILAR EXPERIENCES, UNDERSTOOD THE WORRY OF LEAVING SERVICE AND I FELT, FROM THAT POINT ON, I WASN’T ON MY OWN”

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 AMBASSADOR STORIES 210X297 84 3MM TRUSTEES’ REPORT

“Misty is so important to me. She’s LEON PARKER a therapy dog with her own Army number, and she goes everywhere with “I WAS AT A REAL LEGION SUPPORT HELPS me,” says Leon. “I wanted to live in the VETERAN TRANSITION BACK woods as a way of coping with my own LOW POINT IN INTO SOCIETY paranoia, but Misty was amazing Leon Parker, 25, from Birkenhead, company during that time.” MY LIFE, AND Merseyside, served in the Army for When Leon was ready to return to WITHOUT THE four-and-a-half years. However, when regular society, the Legion was there he left Service, Leon found himself for him. We helped Leon secure a flat, SUPPORT OF MY unable to find a job and struggling to pay his rent and bond, and furnish the cope with regular life. This eventually property. Now, with a little help from FRIENDS AND THE led to Leon and his dog, Misty, ending us, Leon is working as a chef in a up on the streets, where they spent the five-star Wirral hotel and looking ROYAL BRITISH next three years. forward to a better future. LEGION, I DREAD In 2018, Leon tried to take his own “I was at a real low point in my life, life. Once discharged from the hospital, and without the support of my friends and TO THINK WHAT he opted to sleep rough in a tent in the The Royal British Legion, I dread to think woods with Misty by his side. Leon what might have happened,” he says. MIGHT HAVE effectively dropped out of society Today, Leon has a new life, new completely for three months, as he friends, a new career and now hopes HAPPENED” struggled to cope with his latest bout to be reunited with his daughter, who of post-traumatic stress disorder (PTSD). he hasn’t seen in nearly a year.

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 AMBASSADOR STORIES 210X297 84 3MM RUNNING HEAD

Veteran Arthur ‘Les’ Hammond, aged 96 – the Legion took him back across to Normandy on the MV Boudicca, 75 years after he landed at Juno beach on D-Day

REMEMBRANCE

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 REMEMBRANCE 210X297 84 3MM REMEMBRANCE

The Legion chartered MV Boudicca for a voyage to Normandy

We champion Remembrance so that awareness of the Arboretum and members of the Commonwealth, Allies the nation honours the Service and position it as the national destination and Resistance who came to Britain’s sacrifice of British and Commonwealth for Remembrance. This included making aid in defeating the Axis Powers. Armed Forces, veterans and their sure the Aspects events building at Central to these events were the families. They defended our democratic the Arboretum met its income targets. veterans. Yet their attendance at the freedoms and way of life. Our aim Finally, we aimed to pass on a greater commemorations brought unique is to ensure that Remembrance is understanding of Remembrance to challenges. In particular, for D-Day 75, understood and available to all, young people by continuing to develop we needed to make travel abroad and passed on to the next generation. learning resources and engagement easy, comfortable and safe for We will remember them. programmes at the Arboretum. 255 veterans, many of whom were Our goals for 2019 were to approaching their 100th birthdays. remember the 75th anniversaries of the REMEMBER TOGETHER They would need the very best care and Battle of Monte Cassino and the D-Day The Legion adopted ‘Remember support. Never one to back down from landings, the 70th anniversary of the Together’ as the theme for its 2019 a challenge, the Legion chartered a Berlin Airlift and the 50th anniversary commemorations. These marked the cruise ship, the MV Boudicca, to carry of the start of Operation Banner. In 75th anniversary of the momentous these veterans, family members and addition, we aimed to build on the events in 1944 that led to victory in carers across the Channel to Normandy. relationships fostered during 2018’s Europe and the Far East. Particular Many different Legion teams came Thank You campaign, developing new focus was paid to the tide-turning and together to make sure the trip was a projects involving education and arts epic battles of Monte Cassino in Italy, success. The Operations team provided partnerships. We also wanted to build Normandy in France, and Imphal and the highest quality of care, visiting on the success of the National Memorial Kohima in Northeast India. These veterans in their homes and offering Arboretum’s Large Visitor Attraction battles were fought at great cost, not extensive welfare support throughout the of the Year Gold award, to raise only to UK Armed Forces but also to journey and after. The Marketing team

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 REMEMBRANCE 210X297 84 3MM TRUSTEES’ REPORT

REMEMBRANCE

told the veterans’ stories over multiple media platforms. By the time the trip finished, the veterans had appeared in more than 1,000 media stories and had received more than 24 hours of TV coverage. On dry land, the Legion played a pivotal role in a week of remarkable events in Portsmouth, Bayeux and at the Arboretum. We were involved in the international ceremony led by HM The Queen in Portsmouth. We organised the commemorations in Bayeux Cathedral and at the nearby Commonwealth War Graves Veteran Albert Barnes tries out a gun after Commission cemetery, which were disembarking MV attended by HRH The Prince Boudicca on a trip to commemorate the of Wales and HRH The Duchess of D-Day anniversary Cornwall, as well as the British Prime Minister. A collection of veterans and serving personnel attended the Legion’s The Remembrance events were Italy, and a total of 13 nations led by events to honour the memory of Monte also an opportunity to recognise the America and Canada, assisted by Cassino at the Arboretum. We also contribution so many different cultural French Resistance forces, ensured the partnered with the National Army communities made to the battles of D-Day landings led to the liberation of Museum to pay tribute to the battle for 1944. The provinces of British India, France. History would have turned out Imphal and Kohima. It was important for example, committed 2.5 million to quite differently without them on our side. to represent the numerous nations that Britain’s defence – the largest single To celebrate this heritage, the Legion fought at Britain’s side, so we made volunteer army in the history of the worked locally in the UK with the sure these events involved representatives world. The Polish Armed Forces in the social-inclusion charity British Future. from a wide variety of cultures. West made a decisive contribution in We brought people from different backgrounds together to foster a more inclusive participation in Remembrance in both Boston and Leicester. In Boston, attendees with a mix of Polish and British heritage heard from Second World War Polish veteran Wanda Szuwalska. Current serving personnel spoke about the continued relevance of Britain’s Allies. In Leicester, attendees heard from Asian and Afro-Caribbean community leaders, who spoke of their forebears’ contributions during the Second World War. Attendees took part in an Indian sweet-making workshop in a nod to the Indian Comforts Fund, The Armed Forces which sent more than 1.6 million Memorial at the National Memorial Arboretum ‘comfort parcels’ from the UK to Indian front-line soldiers and Prisoners of War

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 REMEMBRANCE 210X297 84 3MM TRUSTEES’ REPORT

during the confl ict. In both locations, commemorations marking the centenary attendees wrote messages of of the First World War. Remembrance on the back of poppies. The Festival of Remembrance is Production of the khadi poppy was now the longest-running broadcast trebled and rolled out to Diwali event in the world, although this year audiences in London and Leicester. is the fi rst time it won a BAFTA – for Best Finally, our website now provides Live Event. The 2018 festival a clearer defi nition of the Legion’s put on a stunning production that Remembrance role. We made more shone a light on the UK and The materials available to the local Commonwealth, the lasting legacy community, such as a Remember Together of the confl ict and 100 years of the fi lm and other historical content. We also Royal Air Force. The tireless crew created materials such as downloadable behind the festival also picked up a lesson plans and assembly packs for BAFTA for Entertainment Craft Team. schools, to help teachers incorporate The Legion’s Director of Music, Captain Remembrance in the curriculum. David Cole MVO RM, was separately honoured with an OBE for his services THE FESTIVAL OF REMEMBRANCEto Music and to Remembrance in The On 4 November 1927, The Royal Queen’s 2019 Birthday Honours List. British Legion held its fi rst Remembrance Festival at the Royal Albert Hall. The 2019 COMMEMORATIVE EVENTS organised battlefi eld tours for veterans world was still recovering from the First In 2019, we saw one of the and family descendants to Arnhem World War. HM The Queen was just Commemorative Events team’s busiest (the Netherlands) and elsewhere in 18 months old. Fast forward 91 years years to date. On top of the events both Europe and Asia. to 2018 and The Queen and the Legion marking the 75th anniversary of famous We worked closely throughout the returned to the Royal Albert Hall as the battles in Italy (Monte Cassino) and year with both the Remembrance and festival bade farewell to four years of France (Normandy), the Legion also Arboretum teams on a range of other anniversaries. There was the 70th anniversary of the Berlin Airlift – commemorated in May at IWM Duxford – and our Operation Banner 50 event at the Arboretum in August, which commemorated the service and sacrifi ce of the 300,000 Service personnel who served in Northern Ireland from 1969 to 2007. In the year marking the centenary of The Armistice, we continued to develop some of our long-standing event commitments. We provided logistic support to the Festival of Remembrance and the coordination of the Cenotaph Parade on Remembrance Sunday. We hosted 4,000 schoolchildren and teachers as they toured battlefi elds in Western Europe, as part of our The Festival of Remembrance in the Royal Albert Hall commitment to helping children understand Remembrance.

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 REMEMBRANCE 210X297 84 3MM TRUSTEES’ REPORT

who served at Monte Cassino, D-Day, Kohima and Imphal. Thousands THE ARBORETUM HOSTED ITS LARGEST- came to reflect on their Service and sacrifice, including HRH The Duke of EVER ARMISTICE SERVICE IN NOVEMBER Cambridge, who led a moving service 2018, WITH SOME 12,000 PEOPLE of Remembrance on 6 June. MARKING THE END OF THE FIRST AIMS FOR 2020 WORLD WAR. THIS CONCLUDED A Continue to play a central role FIVE-YEAR PROGRAMME OF EVENTS in the planning and delivery of commemorations, including VE Day 75 and VJ Day 75 Ensured the representation of veteran and Second World War-generation THE NATIONAL people attending to participate in our voices across the May Bank Holiday MEMORIAL ARBORETUM family activities. weekend to mark VE Day 75 The Arboretum is a place for people Our first year of hiring out the Deliver a programme of activities to reflect and celebrate lives lived, Aspects events building was extremely for VJ Day 75 that accurately reflects and commemorate lives lost in Service. successful, with function contributions the contribution and sacrifice of The site is home to more than 380 finishing three per cent above budget British, Commonwealth and Allied memorials, including the nationally at £436,000. Importantly, 73 per cent Forces, and the civilian experience, important Armed Forces Memorial. of this was attributed to Armed Forces within the final campaign of the Our primary objective for the Arboretum Remembrance activity. Elsewhere Second World War is for the nation to recognise it as we have sought to generate income Provide an accompanying the UK’s year-round centre of through new initiatives, including new programme of exhibitions and Remembrance. We have made good events, new fundraising activity and activities for physical and virtual progress towards this objective. new retail projects, which resulted in visitors to the National Memorial The Arboretum hosted its largest-ever us winning a Retail Greats Gift Retailer Arboretum, to pass on the stories of Armistice service in November 2018, of the Year award. those who lived through the Far East with some 12,000 people in attendance, The Arboretum’s programme of campaign and remember those who marking the centenary of the end of the exhibitions also flourished this year. sadly never returned First World War. The event concluded In September 2019, we hosted the Deliver an educational programme a five-year programme of events and launch of Tribute Ink, an exhibition and materials for young people, activities to remember and thank the showcasing how members of our Armed highlighting the relevance of the First World War generation. The Forces use tattoos to remember the Second World War generation’s Arboretum welcomed more visitors Service and sacrifice of fellow Service experience in the context of the than ever before: more than 342,000 personnel. Other significant showcases challenges faced by the nation as participated in daily acts of of work included Silent Testimony a result of the Covid-19 pandemic Remembrance, guided walks, buggy by Colin Davidson, on loan from the tours, exhibitions, events and activities National Museums NI, and Fashion across the site. Significantly, 22,000 and Freedom, on loan from Manchester of these made use of our learning Art Gallery and 14-18 Now. schemes, an increase of 34 per cent During 2019, the focus transferred on the previous year. The Arboretum to the heroic contributions of those celebrated its most successful February who fought during the Second World half term ever, with more than 9,000 War, especially remembering those

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Frederica McCarthy (Logistics Writer) of the Royal Navy

CAMPAIGNING

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We are proud of our strong history make through question-testing sessions In response to our research of campaigning to support the Armed and focus groups. Ahead of debates on recommendations, the 2019 Tri-Service Forces community. Over time, this the Census Act, we spoke to a range of Families Continuous Attitude Survey work has made a big difference to parliamentarians to explain why they (FAMCAS) included a question on the lives of serving and ex-serving should back the campaign. whether respondents felt lonely. personnel and their families. Over Questions on loneliness will also be the past year, we have continued to HOUSING FOR SERVICE LEAVERSfound in the 2020 Armed Forces champion the interests, welfare and All veterans deserve a home to call their Continuous Attitude Survey (AFCAS). contribution of the Armed Forces own. September saw us launch our new By collecting this information over time, community in line with the principles Housing Best-Practice Guides, helping we can build a long-term picture of of the Armed Forces Covenant, tackle the challenges that Service how Armed Forces families experience campaigning in public, behind the leavers and ex-serving personnel face loneliness and how government policies scenes with decision-makers, and always when it comes to housing. We are can better support them. using the best available evidence. now working with councils across the We also fed into the Scottish In 2019, we developed local, UK to share information and improve Government’s Social Isolation and regional and devolved campaign their services in order to reduce Loneliness Strategy, which now sets messages, working closely with homelessness among the Armed Forces out actions to tackle stigma and invest Poppyscotland to ensure the needs community. The guides also formed part in practical support for veterans of the Armed Forces community were of the No Homeless Veterans campaign, experiencing loneliness, with an reflected in the Scottish Government’s run by Cobseo (The Confederation of aim to reduce the current levels. strategy. We campaigned to scrap Service Charities). immigration costs associated with EDUCATION Indefinite Leave to Remain applications TACKLING LONELINESS AND Growing up in a military family can be for Commonwealth serving personnel SOCIAL ISOLATION challenging for some children. That is who have been in the Armed Forces Our 2018 report, Loneliness and why we strengthened our relationship for at least four years, and their spouses Social Isolation in the Armed Forces with the Service Children’s Progression and children. We also wanted to Community, revealed that a quarter of (SCiP) Alliance, a partnership of respond to the UK Government’s respondents often or always felt lonely. organisations focused on improving Veterans Strategy, to ensure that veterans’ needs were addressed. We planned to make progress in establishing a Service Pupil Premium in Wales. Finally, we aimed to continue to campaign for the policy recommendations outlined in our Loneliness and Social Isolation report and to advance our Count Them In campaign to include an Armed Forces question in the 2021 census.

COUNT THEM IN We have continued to make the case for the inclusion of a question concerning membership of the Armed Forces community in the 2021 census. Veteran Frank Simpson was Building on progress last year, we have painted into his surroundings to highlight the Legion’s helped veterans and dependants to Count Them In campaign demonstrate the difference this would

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outcomes for children from military Private Anthony Muckell, families. This year, the SCiP Alliance veteran and bugler was successful in campaigning for for the Royal Marine universities to identify Service children Band Service applicants and provide them with any specialist support they may need. The SCiP Alliance is not alone in doing good work in this field. In 2019, the Supporting Service Children in Wales Fund helped 39 schools with projects across Wales. A total of 847 Service children benefited. We successfully campaigned to secure renewed funding for this Welsh Government initiative in 2020.

HEALTH AND CARE We continue to fight for veterans to be able to access the health and care services they need. We were pleased that the Department of Health & Social Care convened a working group to address concerns around the implementation of priority treatment for veterans in healthcare services. As a member of this group, the Legion continues to work hard to ensure that veterans’ needs are fully represented. We have worked with the Welsh Government to raise awareness of priority treatment in Welsh GP surgeries, including consulting on the design of materials. Our representations successfully led to the Welsh Government increasing its annual funding to the Veterans NHS Wales service to £700,000. Through this funding, we hope the problem of longer waiting times experienced by veterans needing assessment and treatment for WE CONTINUE TO Service-related mental-health conditions FIGHT FOR VETERANS will be addressed. TO BE ABLE TO ACCESS REGIONAL POLICY Ahead of mayoral elections across THE HEALTH AND CARE the UK in May 2021, we have begun preparing two regional manifestos. For SERVICES THEY NEED the first time, the Legion will produce

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contribution contained 136 1st Battalion Coldstream Guards flag bearers recommendations for practical ways display flags from that the UK Government and society Commonwealth nations can improve services and support for our veteran community.

AIMS FOR 2020

Research and publish a new report on the interaction between state benefits and Armed Forces compensation Oversee the successful completion of our Count Them In campaign, with Parliament formally agreeing to the inclusion of an Armed Forces question in the 2021 census Pursue our Stop the Service Charge campaign, to ensure Indefinite Leave to Remain fees are waived for Commonwealth personnel and their dependants when the personnel have served four years or more Seek to ensure a future for the Veteran Medical Funds, which the Legion administers on behalf of the Government mayoral manifestos in London and the support. The Home Office is now Establish a new Veterans Scotland West Midlands. We will also produce actively looking into the issue. Policy Group for the sharing of best a document for Greater Manchester, practice across the military charity following the one we prepared for the VETERANS STRATEGY sector in Scotland and greater 2017 mayoral election. In 2019, we November 2018 saw the UK collaboration in advancing issues held consultations to begin identifying Government publish The Strategy for with the Scottish Government the ‘asks’ for each document. Our Veterans. It sets out the principles Pursue changes to the Pupil Level and aims of support for the veteran Annual School Census (PLASC) in STOP THE SERVICE community over the next ten years. Wales to ensure that measures aimed CHARGE CAMPAIGN At the same time, the UK, Scottish at supporting Service children are Ahead of Commonwealth Day, we and Welsh governments consulted on properly targeted and evidenced launched our Stop the Service Charge how best to implement the strategy. Prepare regional manifestos in London campaign on 8 March. It calls on the In response, this year we held ten and the West Midlands ahead of the Government to scrap visa fees for focus groups throughout the UK with next mayoral elections Commonwealth personnel and their veterans, family members, Legion staff families when applying for indefinite and partner organisations. We drew leave to remain in the UK following four on research from across the charitable years of Service. This campaign has and academic spheres and reached gained national media coverage. The out to our supporters and members MoD is supportive and more than a to contribute to the Government’s quarter of MPs have also pledged consultation directly. Our final

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MEMBERSHIP

Norman Pearce, Christchurch Branch Standard Bearer

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MEMBERSHIP

Our community of more than 230,000 We have continued to engage REVIEW OF MEMBERSHIP members sits at the heart of The Royal with our members via our regional TRAINING British Legion, playing a vital role Membership Meet-Ups, which saw a We are constantly seeking to improve in everything we do. Many of our 63 per cent increase in attendance last the training our members receive. members are actively involved in year and received overwhelmingly This year, we conducted a review one of the Legion’s 2,500 branches, positive feedback from those who of our member training, alongside carrying out local welfare, fundraising attended. Our monthly membership the Membership Council, County and championing Remembrance in e-newsletter has seen a 10 per cent Training Officers, County Chairmen, their local communities. increase in subscriptions and we have Membership Support Officers and many A key aim for 2019 was to conduct launched a new quarterly Club Connect others. This has helped identify the research in order to better understand bulletin to share news, policy and stories courses that need updating and the our members. This will enable us to with The Royal British Legion clubs. gaps in our current training. In addition, improve the membership experience For those members involved in running the review highlighted the popularity of for all our members and create new our large network of branches, we online courses and home learning as membership options that better cater for created a new Membership Handbook, alternative methods of study. We also particular groups. We also set out to which contains all the information introduced General Data Protection review how we communicate with our branch officials need to effectively Regulation (GDPR) and Safeguarding members and the training we provide. run their branch. The handbook was training for members this year. Finally, we pledged to improve how we launched alongside the updated Royal use social media to promote the Legion Charter in January 2020. and Legion membership, attract new AIMS FOR 2020 supporters and better engage with CREATING NEW OPTIONS existing members. FOR MEMBERS Implement the improvements identified We encourage our members to make in the membership survey UNDERSTANDING the Legion their own by creating Review our membership governance OUR MEMBERSHIP branches that reflect their interests and arrangements and ensure that they are Understanding our members is vital identities. In late 2018, a group of aligned to those of the wider Legion to growing our community. In 2019, ex-Service personnel formed a new Implement the findings from our more than 18,600 members responded LGBTQ+ and Allies branch, which review of membership training and to a survey about how we can further has gone from strength to strength since launch a new training prospectus improve their experience. We were its inception, thanks in large part to Streamline the membership delighted with the range of different promotion of the branch on social media. renewals process and reduce members who responded, and over In order to make Legion membership card distribution times the coming year will implement more more accessible, and to meet the Introduce a membership welcome than 90 recommendations to improve demand of members wishing to pack for new joiners Legion membership. communicate online, we are speaking Finally, we pledge to improve how we to current and potential members about use social media to promote IMPROVING THE MEMBERSHIP new digital member services that membership EXPERIENCE interest them. We will then prepare This year, we worked to improve the proposals for new digital options for service our members receive when membership, which will build on the renewing or making changes to their successes of the past year. These membership. By improving the quality include: increased use of our of our data and introducing new membership portal (O365), which service-level agreements, we will be is now used by 2,150 branches; an able to deliver better customer service active member community on Yammer; to members, especially during our main and an increase in online Annual renewal period. Conference applications.

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Dawn Sperduti is an Area Offi cer, member and volunteer

VOLUNTEERING

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VOLUNTEERING

recommend volunteering for the Legion programme, allowing members of the to family and friends. However, only public to volunteer to help the Legion “It offers me an opportunity 56 per cent of our volunteers felt the during large-scale events. More than 200 to give something back to theLegion provided them with effective volunteers have ensured our supporters Armed Forces community. I getsupport. So, in 2019, we enhanced our have an enjoyable experience at great satisfaction from helping Excellence in Volunteer Management marathons, abseils, dinners and people, whatever the query programme to help our volunteer concerts. Other new volunteer roles or problem, and enjoy the supervisors to provide better support. included Military Kids Club Heroes, comradeship of being part The programme includes induction days Dementia Group volunteers and of a team.” for new employees with responsibility Outreach Support volunteers. – A Legion volunteer for supervising volunteers and an online Volunteer Management Toolkit. We also As one of the most trusted charity launched a new Volunteer Voice Group, AIMS FOR 2020 brands in the UK, our aim is to become bringing together representatives from a national leader in volunteering. More all major volunteer roles in the Legion to Extend the reach of our supervisor than 120,000 dedicated and committed gain feedback on issues that affect them. training, ensuring that all staff who volunteers contribute an estimated We introduced workshops for all supervise volunteers have the skills 2.5 million hours of hard work each year, supervisors of volunteers, covering they need helping to provide support or fundraising volunteer recruitment, supervision and Improve our Excellence in Volunteer for the Armed Forces community. support. So far, we’ve held 21 days Management programme, using How we support our volunteers is just of training, with 92 supervisors technology to explore new ways of as important as how they support us. attending one of these workshops. developing our volunteer supervisors Our goals for 2019 were to review the The programme is paying off already: Review volunteer wellbeing and volunteer journey to make volunteering post-course feedback shows supervisors’ ensure that we are addressing both with the Legion a more enjoyable confidence in managing volunteers is the physical and mental wellbeing experience. We aimed to set up a up from 60 per cent to 86 per cent. We of our volunteers volunteer-engagement group to gain updated and improved the volunteering Develop a suite of reward and feedback and build on findings from section of our website, making it easier recognition tools to enable the annual volunteer survey. We to navigate and understand our supervisors to thank their volunteers promised to improve training, so that volunteering offer. in a meaningful way our volunteers and line managers have We recognise that volunteers need Improve how we manage our volunteer the confidence and skills they need to to feel confident if they’re to perform data to ensure we are able to maximise carry out their roles. We also planned at their best. To build this confidence, the experience of our volunteers to evolve our Excellence in Volunteer we enhanced our Essential Learning Management programme (EVM) and programme for new volunteers and to improve the quality of our data launched new training for our and briefing information. Finally, we Community Support volunteers. We pledged to improve the quality of life updated our caseworker training and of residents in our Care Homes and launched new annual refresher training dementia wings by creating new for all relevant roles. As part of our volunteer roles and enhancing our promise to improve the quality of life in Care Home volunteer training. our Care Homes and dementia wings, we enhanced the skills of our Care Home SUPPORTING OUR VOLUNTEERS volunteers by launching an induction Our 2018 Volunteer Engagement pack that included dementia awareness survey reported that 97 per cent of and bereavement care guidance. respondents felt proud to volunteer for In 2019, we launched our Mass the Legion and 86 per cent would Events volunteering opportunities

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Children participating in a Poppy Run

FUNDRAISING

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A Poppy Appeal volunteer from the First Aid Nursing Yeomanry (Princess Royal’s Volunteer Corps), during the 2019 Appeal

Our fundraising portfolio is wide- We had several goals for 2019. We product purchasing. We would develop reaching and varied. It includes the wanted to deliver a best-in-class supporter new products to engage with new annual Poppy Appeal, Poppy Runs and experience and become more efficient, audiences and improve our approach Poppy Shop, as well as initiatives from while ensuring we complied with to working with our key suppliers. our corporate partners. Our members fundraising regulation. We promised and volunteers, along with people from to conduct an end-to-end review of our 2018 POPPY APPEAL other organisations and corporate Community and Mass Events portfolios The 2018 Poppy Appeal raised nearly partners, contribute to much of our and to develop a long-term strategy for £55 million, the largest amount in our fundraising work. We feel very lucky Individual Giving. We set out to review history. This was accomplished through to have their loyal support. our digital fundraising, upskilling our the Thank You campaign, with around In 2019, we raised £124.3 million teams and developing appropriate 500 community events taking place (2018 - £120.1 million) from voluntary platforms and technology. We pledged across the country. income and trading activities, which to review our Poppy Appeal and The Poppy Appeal and other was 4 per cent more than last year. Community Fundraising activity and fundraising projects succeed thanks This was mainly thanks to the 2018 make changes to safeguard these to the generous help we receive. Our Poppy Appeal, which commemorated activities, whilst exploring opportunities role is to work closely with volunteers, the 100th anniversary of the end of to increase future returns. We said we partners and supporters to organise this the First World War, together with our would review our Poppy Shop activity to activity. In total, we distributed roughly Thank You campaign. better define its purpose and centralise 40 million poppies, 7 million pin

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badges and 27,000 school packs. occasion, they produced a special INDIVIDUAL GIVING We continued to expand our use of Thank You coin, which was used to We completed our review of Individual contactless technology and, building on kick off Premier League fixtures Giving and the team was restructured the success of the 2018 appeal, started dedicated to Remembrance. in the autumn of 2018. In 2019, we our review of Poppy Appeal and In 2019, we also launched exciting commemorated the end of the First Community Fundraising activities. new partnerships with the Scouts World War with a special Thank You and Girlguiding, promoting our edition of Poppy Press, our supporter CORPORATE PARTNERSHIPS Remembrance message to more than newsletter. The newsletter went down Our corporate partners played a a million young people through a range well with our supporters, who kindly pivotal role in the success of the Thank of dual-branded poppy merchandise. donated more than £600,000 in You movement, which culminated in Another new partner, Pets At Home, response to this very special appeal. November 2018. Thank You messages raised more than £250,000 from its Legacy income is critically important lined the entrances of Marks & Spencer range of poppy-themed accessories for to the Legion. There were 898 generous high-street stores and raised more than our supporters’ cats and dogs. Once individuals who left us more than £1.2 million from an expanded range again, we thank all of our corporate £21 million in their legacies this year. of poppy products. Coventry Building partners. Without their help, we couldn’t We are also immensely grateful to the Society donated more than £1.1million continue to provide the wide range of 2,500-plus people who let us know from Poppy Bond balances and support services our Armed Forces that they would be leaving a gift in commemorated Coventry’s fallen at the community needs and deserves. their Will to the Legion. city’s train station. Sainsbury’s and its suppliers gave donations from the sale of heritage brands, alongside helping the Legion to raise more than £3 million for the Poppy Appeal. Funeral directors and their families at Golden Charter shared poignant wartime stories. In 2019, we marked 15 years of our partnership with The Westminster Collection, reaching a £1 million milestone. To commemorate the

THE 2018 POPPY APPEAL RAISED NEARLY £55 MILLION. WE DISTRIBUTED 40 MILLION POPPIES AND 7 MILLION PIN BADGES Poppy Appeal volunteers

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reduction in more expensive brooches and hero products. Our product development team worked with the Thank You campaign team to launch several new products. These included the Women of The First World War brooch, to commemorate the vital role that women played in this conflict. We also expanded our range of watches and smart wear, along with our range commemorating D-Day 75. As promised in last year’s report, we reviewed our merchandising strategy and set up a new team responsible for quality assurance, procurement and buying merchandise across the Legion.

AIMS FOR 2020

Complete the review of our fundraising strategy and implement its recommendations Commemorate the 75th anniversary of VE Day and VJ Day, working in Cyclists on the 4-day collaboration with the rest of the Pedal to Paris cycle event organisation to execute a UK-wide approach to fundraising around MASS EVENTS relationships with Major Donors, Trusts these significant anniversaries Our Poppy Run initiative enjoyed a and Foundations. We started to develop Improve our data to better monitor record year, raising £250,000 across a new donor-focused strategy for the efficacy of our fundraising ten different 5k fun run events. There was philanthropic fundraising. Our highlight Review our product and media also a virtual My Poppy Run for those of the year was an £800,000 grant portfolios, ensuring that each of who could not make one of the events in from a Trust, given anonymously, which our products generates sustainable, person. We successfully piloted our first has made a huge difference to our work cost-effective income for the Legion Poppy Ride event, attracting 140 cyclists and the members of the Armed Forces Enhance the supporter experience to bike between the Legion’s Battle Back community that work supports. to drive repeat participation Centre and the National Memorial Improve how we communicate Arboretum. This, we hope, will become POPPY SHOP with our supporters so that we a major addition to our existing cycling In 2019, the Poppy Shop generated become more audience focused portfolio. We concluded a review of turnover of £5.4 million and a profit of Develop our corporate partnerships our events portfolio across Community £532,000, a 50 per cent increase on outside of the Poppy Appeal Fundraising and Mass Events, which 2018’s profit. This comprised sales of Complete the review of the Poppy resulted in us stopping some events. £4.74 million via the website and a Appeal and Community Fundraising further £660,000 of income through and develop a plan to implement the PHILANTHROPY Amazon. This was less than last year’s recommendations, whilst adjusting In 2019, we established a new turnover due to a change in product mix, our planned activity in light of the Philanthropy team, who manage our which saw an increase in pins and a Covid-19 pandemic

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RESPONSIBLE FUNDRAISING on our website and we have complaints: 471 were received relating The Legion’s approach to introduced a new Preference Centre to fundraising activity. We monitored fundraising is driven by three to give supporters full control of the complaint trends during the year and key fundraising principles: communications they receive. We addressed these through improvement Accountability Our own and continue to try hard to ensure that our projects. We identified 80 complaints third-party fundraisers are required fundraising is not unreasonably intrusive relating to our communications to ensure that their fundraising or persistent and does not put anyone scheduling, 17 per cent of our total. is delivered to the Fundraising under undue pressure to donate. All We built this feedback into a project Regulator’s standards. We will mass supporter communications are to improve our approach to planning only work with third parties who checked for compliance before they communications, set to be completed share this commitment. go to print and we continue to invest in 2021. Fairness We set out to treat in ways to ensure we are not Some of our fundraising activity all members of the public fairly. overcommunicating with our supporters. is carried out by our own staff, some We try to explain clearly how We recognise that we have an by volunteers, and a small proportion donations can be made, how obligation to protect those who may is delivered by professional fundraising regular donations can be stopped be in vulnerable circumstances. We agencies. The Royal British Legion has and how supporters can change do this in a way that strikes a balance; written agreements in place with all their communication preferences. setting out to protect potential donors of our third-party fundraising partners. Respect We respect our supporters while also being respectful of any desire All commercial third parties are subject and their privacy. We continue to they express to support us. During to due diligence at the procurement fundraise to a high standard and 2019, we further strengthened stage and ongoing monitoring by the make use of both the Mailing and the links between fundraising and the Legion’s own fundraising staff and Fundraising Preference Services. Legion’s safeguarding rules, including external agencies, such as the Institute ensuring our fundraising staff received of Fundraising. This ensures they The Legion is registered with the refreshed safeguarding-awareness are acting in line with the regulatory Fundraising Regulator, Gambling training and updating our responsible requirements and our own Commission and Data & Marketing gambling procedures. organisational values. We conduct Association, and is a member of the We always aim to provide our ongoing monitoring of external Institute of Fundraising. We always aim supporters with a positive experience. agencies, which consists of mystery to comply with the Code of Fundraising We also recognise that fundraising shopping, shadowing, call monitoring Practice and we make appropriate activity sometimes generates complaints and training. The level of monitoring use of the Fundraising Regulator logo and so we ensure that we learn from and training is proportionate to on our fundraising materials. Our these. During 2019, we trained our each agency’s performance and Fundraising Promise is published fundraising staff in how to recognise, is determined during weekly status on our website and included as part handle and record fundraising calls and quarterly review meetings. of our inductions for new fundraising staff. We strive to comply with the commitments we have made. We took steps to ensure compliance with UK data-protection legislation. During 2019, we ran further data- WE SET OUT TO TREAT ALL MEMBERS protection exercises, refreshed fundraising staff knowledge through OF THE PUBLIC FAIRLY. WE ALWAYS online data-protection training, updated our approach to fundraising research AIM TO PROVIDE OUR SUPPORTERS and reviewed our field-based procedures to support our volunteers. WITH A POSITIVE EXPERIENCE Our Privacy Promise has been updated

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 FUNDRAISING 210X297 84 3MM BOARD OF TRUSTEES

LIEUTENANT GENERAL AIR MARSHAL UNA CLEMINSON BEM TD TERRY WHITTLES JAMES BASHALL CB CBE DAVID WALKER CB CBE AFCNational Chairman National Chairman National President National President (from May 2019) (to May 2019) (from May 2019) (to May 2019) Una was elected as National Terry joined the Army in 1966 James retired from the Regular David joined the RAF in 1978, Chairman in May 2019. She and served as a Linguist in the Army in 2018 following 34 completing tours in Germany, the retired as a registered General Intelligence Corps. Terry retired years’ Service, including tours US and the UK before becoming Nurse in 2012 and was a Major from the Regular Army in 1981 in Germany, Afghanistan, Iraq, the Military Assistant to the in the Territorial Army. Una has with the rank of Warrant Officer; Libya and South Armagh. He Minister of Defence. He was been a member of the Legion he then served in the Territorial later held the posts of Chief appointed Assistant Chief of the since 1971 and was previously a Army for 12 years before retiring of Staff at Permanent Joint Air Staff in 2003. He became trustee between 2010 and 2012. with the rank of Major. Terry Headquarters, Director of Deputy Commander of the NATO completed his term as National Personnel at Army Headquarters Joint Force Command before Chairman in May 2019. and Commander Home retiring from the RAF in 2013. Command, overseeing the support David completed his term as elements from training to welfare. National President in May 2019. James was appointed as the National President in May 2019.

LIEUTENANT COLONEL LIEUTENANT COLONEL RODNEY BEDFORD ELIZABETH HARRISON JOE FALZON OSJ BEM (Retd)COLIN KEMP (Retd) (from January 2020) Rod served for 19 years in the National Vice-Chairman National Vice-Chairman Grenadier Guards, and then for Liz was elected as Chairman of (from September 2019) (to August 2019) 18 years in the Kent Police. Rod the Women’s Section in January Joe was elected as a Trustee in Colin was elected as a Trustee in was previously elected to the 2020. Liz takes her seat on the 2014 and re-elected in 2017. He 2014 and re-elected in 2017. He Membership Council, on which Board of Trustees as the Chairman joined the Army in 1963, retiring joined the Army as an Apprentice he served two terms of three of the Women’s Section in in 2001. He served as the in 1965 and retired in 2001 with years. He was elected to the accordance with the Rules Legion’s Head of Governance & the rank of Lieutenant Colonel, Board of Trustees in May 2017 contained in the Royal Charter. Administration from 2001 until primarily in the finance and and currently serves on the 2010. Joe is Chairman of the administration fields. Colin Branch Property Trusts Trustee Property Committee and the resigned from the Board of Committee and the Audit & Risk International Committee and Trustees in August 2019. Committee. Rod is The Royal a member of the Governance British Legion member of the Committee, Branch Property Trusts Board of Liberation Route Europe Trustee Committee and the Board and currently runs his own of Trustees of Poppyscotland. company in France.

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 TRUSTEES & EXECUTIVES 210X297 84 3MM TRUSTEES’ REPORT

PAT CHRIMES JASON COWARD DENISE EDGAR PAUL HARRIS QGM (to January 2020) Jason has been an Appointed Denise joined the Board of Paul served for 32 years as an Pat served on the Board of Trustee since 2014. He has been Trustees in 2010, and was Army Officer, retiring in 2006 with Trustees as Chairman of the Chairman of the Membership re-elected in 2014 and 2017. the rank of Lieutenant Colonel. Women’s Section between April Council since May 2019. He Denise is a member of the He worked with an international 2017 and January 2020. is a member of the Governance Property Committee and the company and then owned a Committee and also serves as Branch Property Trusts Trustee management consultancy. He has a Trustee and Non-Executive Committee. since retired. Paul is a member Director at the National Memorial of the Governance Committee, Arboretum (NMA). Outside the Vice Chairman of the Membership Legion, Jason runs his own Council and serves on the Board marketing agency in Bristol. of Trustees at the NMA.

MAJOR GENERAL ANTHONY MACAULAY PHILIP MOORE TD ANNY REID OBE DAVID JOLLIFFE CB FRCP Anthony was appointed as a Philip was appointed as a Trustee Anny was elected as a Trustee David was appointed as a Trustee Trustee in 2011 and reappointed in 2014 and reappointed in 2017 in May 2016. She served in the in 2012 and reappointed in 2015 in 2014 and again in 2017. He and 2020. He was a Finance Princess Mary’s RAF Nursing and 2018. He was commissioned is a retired lawyer with extensive Director for nearly 20 years. Service for 30 years, the last four into the Royal Army Medical Corps business and commercial He is now a Non-Executive as Chairman of the Princess in 1967 and retired in 2003. experience. He is a member Director at Bank of Ireland (UK) Mary’s RAF Trust. Anny chairs the David is Chairman of the Royal of the Finance Committee and plc and Codan Forsikring A/S Conference Committee and is a British Legion Republic of Ireland the Property Committee and and a Governor of North member of the Branch Property and is a member of the Audit & Chairman of the Board of Trustees Hertfordshire College. Philip Trusts Trustee Committee and the Risk Committee. of Poppyscotland. chairs the Finance Committee. Audit & Risk Committee.

LIEUTENANT COLONEL DEBBIE SORKIN ELIZABETH BUTLER FCA LYNDA ATKINS DL DAVID WHIMPENNY (Retd) (from May 2019) Debbie was appointed to the Liz was appointed to the Board in David was elected as a Trustee in Board in June 2018. She is May 2018. In addition to being Lynda was co-opted on to the 2013 and re-elected in 2016. He National Director of Systems a chartered accountant, Liz has Board in May 2019. She served was commissioned from the Royal Leadership at the Leadership a portfolio of non-executive roles, in the Royal Air Force and then Military Academy Sandhurst in Centre, a charity working to including Board member and in the Royal Electrical and 1985 and retired from the Army in strengthen leadership across Chair of the Audit Committee of Mechanical Engineers TA. Lynda 2017. He works as a Programme public services. Debbie has the Regulator of Social Housing served as an independent Management Consultant. David extensive experience of working and Chair of the Audit & Risk County Councillor before being serves on the Governance in the NHS and in social care, Committee of the Royal College appointed Deputy Lieutenant in Committee and is Chairman of and leads for the Board on of Veterinary Surgeons. Liz chairs 2019. Lynda is a member of the the Board of Trustees at the NMA. care and safeguarding. the Audit & Risk Committee. Finance & Property Committees.

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 TRUSTEES & EXECUTIVES 210X297 84 3MM BOARD OF TRUSTEES

CO-OPTED MEMBERS KEY COMMITTEES OF THE BOARDBranch Property Trusts The Trustees would like to recognise OF TRUSTEES AND CURRENT Trustee Committee the support given by the following MEMBERSHIP Jenny Rowe (Chairman) co-opted members, who bring their Audit & Risk Committee Rodney Bedford special expertise to the committees Elizabeth Butler (Chairman) Denise Edgar on which they sit: David Jolliffe Joe Falzon Rodney Bedford Anny Reid David Bennett Rees FIA Anny Reid Dr Jonathan Wittmann International Committee Jenny Rowe Finance Committee Joe Falzon (Chairman) Philip Moore (Chairman) Rodney Bedford National President Anthony Macaulay Bob Chambers Lieutenant General Lynda Atkins James Bashall CB CBE Elizabeth Butler Membership Council David Bennett Rees Jason Coward (Chairman) National Chaplain Dr Jonathan Wittmann Paul Harris (Vice-Chairman) The Right Reverend James Newcome DL Gordon Barker Governance Committee Mike Barry Una Cleminson (Chairman) John Boisson Jason Coward Bob Chambers Joe Falzon John Clark Paul Harris Emma Cox David Whimpenny Philip Davies Dilys Hooper Property Committee Pete Hopkins Joe Falzon (Chairman) Ralph Howard-Williams Anthony Macaulay Harold Jennings Denise Edgar Garry Mills Lynda Atkins John Morrison Gerry Nunn Conference Committee Kelly Slark Anny Reid (Chairman) Ken Terry Sue Kelly Hugh Ashton-Moore Philip Davies John Morrison John Gilmore

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 TRUSTEES & EXECUTIVES 210X297 84 3MM TRUSTEES’ REPORT

EXECUTIVE BOARD Investment Managers National Life Vice-Presidents Director General Cazenove Capital Dame Mary Bridges DBE Charles Byrne Management Limited Mrs M Humphry 1 London Wall Place Doris Ingham OBE Director of Finance & Commercial London EC2Y 5AU Maureen Lodder OBE Daniel Oppenheimer Patricia Valler OBE Legal Advisors Wendy Bromwich JP Director of Fundraising Withers Claire Rowcliffe 20 Old Bailey National Vice-Presidents London EC4M 7AN and Patronesses Director of Operations Auriol, Marchioness of Linlithgow Antony Baines WOMEN’S SECTION Elizabeth, The Dowager Countess of President Scarborough LVO Director of Remembrance HRH The Princess Royal The Right Honourable the Countess & Marketing Bathurst Gary Ryan Chairman The Lady Grey of Codnor Elizabeth Harrison Baroness Grey-Thompson DBE Director of Human Resources & Joanne Andrew-Steer MBE Organisational Development Vice Chairman Sara Jones CBE OStJ DL JP Sue Donaldson (to February 2020) Jennie Bailey Janie Martin DL Karen Gill (from February 2020) Joan Murray MBE Chair of Finance Diana Hill Director of Membership Sandra Fishlock Jane Lewin Smith JP DL & Volunteering Emma Cannings (to July 2019) Central Committee Charity Registration Number Pat Ayres MBE 219279 CONSULTANTS AND ADVISORS Jan Buxton Bankers Margaret Cook Principal office Lloyds Bank Sandra Fishlock The Royal British Legion, Charities Sandra Saban Haig House, 4th Floor Pat Holden 199 Borough High Street, 25 Gresham Street Sue Shephard Stainton London SE1 1AA. London EC2V 7HN

Independent Auditors Deloitte LLP Hill House 1 Little New Street London EC4A 3TR

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 TRUSTEES & EXECUTIVES 210X297 84 3MM FINANCIAL REVIEW

Total income for the year wasrealised and unrealised gains on The mandates agreed with Cazenove £175.9 million, compared with £163.2 investments of £13.5 million (2018: Capital and Sarasin & Partners specify million in 2018. The £12.7 million (7.8 £13.5 million), reflecting profits on the level of risk that can be undertaken per cent) increase in our income reflects disposal and increases in the market by defining asset classes and ranges, unprecedented public support for the value of our investments and investment benchmarks, and acceptable volatility. November 2018 Poppy Appeal, which properties. The deficit on the Group The investment managers have total reached nearly £55 million, driven in defined-benefit pension schemes discretion within these parameters. large part by the commemorations to increased by £1.5 million (2018: £2.5 All investments must comply with the mark the centenary of the end of the million decrease) due to changes in the Legion’s ethical policy which is one of First World War. Income from charitable assumptions used by the actuaries, most ‘Responsible Investment’. Investment activities also increased due to notably a reduction in the discount rate managers engage with companies on government grants received to fund used to value future pension liabilities. social, environmental and business commemorative events and the Veterans After these adjustments, the total value ethics issues and to exercise the Legion’s Medical Fund, which provides specialist of the Legion’s funds increased by voting rights, following the policy. equipment to veterans with healthcare £6.2 million (2018: £13.9 million). needs attributed to Service. CAZENOVE CAPITAL Restricted funds increased by £1 million The mandate agreed with Cazenove Total expenditure was £181.7 million, and unrestricted funds increased by Capital for the year ended 30 compared with £165.3 million in £5.2 million. Of this increase to September 2019 was to achieve a rate 2018, an increase of £16.4 million unrestricted funds, £3.5 million of return in excess of CPI+3 per cent (10 per cent). The largest increase was represents an increase in our functional over the medium term. The Cazenove in community welfare (£6.8 million fixed assets reserves. Available, Capital portfolio outperformed the increase), reflecting the trend of people unrestricted funds decreased from 2019 mandate due to strong equity coming to us with ever more complex £67.7 million to £66.7 million. markets. The value of the portfolio needs, resulting in a £3.7 million Unrestricted funds will reduce over the increased to £136.1 million (2018: increase in the cost of grants to coming years as we invest in those £129.2 million) over the year and individuals. The value of grants given services that have the biggest impact generated £2.3 million (2018: to other organisations also increased, on the lives of those we support. £2.6 million) of investment income. and included a £1.6 million grant to Combat Stress and a £4.6 million SARASIN & PARTNERS increase in the grant to the Officers’ During the year to 30 September 2019, Association, driven by changes to FINANCIAL the Poppyscotland portfolio increased the grant agreement, which led to its value from £10.6 million to £11.1 a multi-year grant commitment being INVESTMENTS million and generated £0.4 million recorded in 2019. (2018: £0.4 million) of investment The market value of The Royal British income, equivalent to 5 per cent on Expenditure on Remembrance and Legion’s investment portfolio increased a total return basis. The mandate ceremonial activities increased by by £9.7 million during the year. At the agreed with the investment manager £5.4 million, reflecting the cost of the year-end, the total value of the Group’s is to achieve a rate of return in excess programme of events to commemorate investments was £165.9 million (2018: of RPI+2 per cent over the medium to the centenary of the end of the First £156.2 million). The portfolio is long term. World War, including D-Day 75 and managed through three investment the events at Portsmouth, Bayeux and managers; Cazenove Capital manage CHARITIES OFFICIAL INVESTMENT the National Memorial Arboretum. the charity’s main investment portfolio, FUND (COIF) WITH CCLA Sarasin & Partners manage Branch, County and other investments Overall, The Royal British Legion Poppyscotland’s investments and CCLA of £9.8 million (2018: £9.6 million) generated a planned deficit before manage branch-related investments, are held in a mix of listed investments gains and losses of £5.8 million (2018: including those held in legacy and and unit trusts. £2.1 million). This was offset by property trusts.

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After the year-end, the Legion’s In common with other charities, the investment portfolio was adversely Legion holds reserves to ensure that INVESTMENT affected by the economic impact our services can continue during a of Covid-19 – see ‘Covid-19 and period of unforeseen reduced income PROPERTIES going concern’ section on page 44 or increased expenditure. Our reserves for further details. policy is set with reference to the Investment properties primarily comprise financial risks facing the charity. 310 properties (2018: 330) held by The Legion is heavily dependent on The Royal British Legion as trustee PENSION volunteer support and donations from (predominantly under Branch Property the public to enable it to carry out its Trusts) and let to independent The pension deficit has increased from work. Our biggest risk is that our commercial operations, primarily £4.1 million to £6.6 million, primarily income suddenly drops because of affiliated social clubs. The local Legion due to a reduction in the discount rate unforeseen factors beyond our control. branches also have part-time use of the used to calculate the present value of In these circumstances, reserves would property under the terms of the lease. future pension liabilities. This follows need to fund operating expenditure a £2.1 million reduction in the deficit while the organisation was put back The Legion’s methodology with regard in the previous year and highlights onto a stable footing. Our Care Homes to the valuation of investment properties the sensitivity of the calculations to represent a further area of financial is to revalue one-fifth of the properties relatively small changes in underlying risk due to the heavily regulated nature each year and to carry out a review of assumptions. The Royal British Legion of the industry and the challenges the remainder to identify any event that and the pension-fund trustees have in recruiting and retaining suitably would impair the valuation. For the year agreed a plan for removing the pension qualified and experienced staff. to 30 September 2019, 82 properties deficit over an appropriate period of Finally, our reserves mitigate against were externally revalued (2018: 59) time and we do not expect the deficit fluctuations in the value of our and a revaluation gain of £2.35 million to materially affect the Legion’s ability to investments, in particular the risk that a (2018: £3 million) was recorded in the meet its charitable objectives in the future. significant reduction in income coincides accounts. The remaining 80 per cent with a drop in investment values. of investment properties were reviewed internally by a qualified surveyor and During the year to 30 September 2019, revaluation losses of £8,000 (2018: FUNDS & the trustees reviewed the Legion’s gains of £4.1 million) were recorded. reserves policy in the context of these During the year, the Legion disposed RESERVES risks and agreed that the Legion should of 23 (2018: 22) investment properties seek to hold reserves of approximately realising proceeds of £7.5 million The Royal British Legion’s total funds £55 million. As noted above, at (2018: £4.9 million). of £372 million (2018: £366 million) 30 September 2019, the Legion was represent the value of the assets used holding reserves of £66.7 million In 2017, 35 properties with a value by the charity to deliver its charitable (2018: £67.7 million). The emergence of £3.2 million were removed from objectives, including its Care Homes, and spread of Covid-19 in early the Legion’s accounts. These were offices, branch properties and the 2020 has led to significant financial properties held in the name of the National Memorial Arboretum. The challenges for the charity sector. Our Legion where the branch committee charity’s funds are explained in reserves will enable the Legion to was the managing trustee and had more detail on page 7; they include adapt to meet these challenges and the legal responsibility for the £66.7 million (2018: £67.7 million – ensure that we can continue to provide administration of the property. During restated) of liquid and immediately services to those we support in a time 2019, nine (2018: seven) of these available unrestricted reserves. It should of economic uncertainty. properties were brought back into the be noted the definition of ‘available accounts following a decision by the reserves’ used by RBL has been respective branch committees to transfer amended to include the pension the trusteeship to the Legion. reserve in 2019.

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 FINANCIAL REVIEW 210X297 84 3MM Trust Funds that derive from Branch related grants, such as riser-recliner BRANCH Property Trusts, can now be used to chairs and powered scooters, were support people in a wider geographical most common. The Legion also PROPERTY area and for specific projects and awards grants to households whose activities forming part of the Legion’s case is managed by a partner agency, TRUSTS corporate strategy. During the year to 30 such as SSAFA or the Royal Air September 2019, £1.8 million (2018: Forces Association. A Branch Property Trust is a property £3.1 million) of direct charitable or the proceeds of its sale that is held expenditure was funded from the Area The grant of £6.7 million made to in a separate charitable trust in Trust Funds, including the cost of the Officers’ Association (OA) is a connection with a branch of The Royal providing Admiral Nurse services, war contractual commitment. The grant funds British Legion. Its charitable purposes pensions advice and grants made to the charitable activities of the Officers’ are usually restricted to a specific local charities providing services to Association. Other grants are made to geographical area. Legion beneficiaries in these areas, organisations where a third party has together with a contribution towards the skills or facilities that are unavailable 2019 2018 cost of the hub and dementia unit within the Legion’s own resources. The Restricted extension at Galanos House. Legion invites organisations to submit Investment formal applications which are then Property Reserve £65.0m £66.7m evaluated by the Grants Department, Restricted Branch the local Area Office and any Property Trust Fund £46.9m £45.8m PROGRAMME- subject-matter experts relevant to the application. This information is then Number of reviewed by a Grants Panel, which properties 310 330 RELATED issues awards to those organisations INVESTMENTS best able to show that their project At 30 September 2019, the Legion held will address an unmet need for £65.0 million (2018: £66.7 million) Programme-related investments mainly Legion beneficiaries. (see note 29) in the restricted investment consist of property repair loans that property reserve, representing the are interest-free secured loans to In 2019, excluding the OA, grants market value of 310 (2018: 330) beneficiaries living in their own home were awarded to 52 organisations, properties predominantly held under to provide housing improvements. totalling £5.9 million (2018: 136 Branch Property Trusts. In addition, Programme-related investments totalled organisations, £7.4 million). £46.9 million (2018: £45.8 million) £5.0 million at the year-end (2018: was held in restricted Branch Property £5.6 million). Trust funds comprising sale proceeds, interest and other income, from the COVID-19 properties previously held in trust. GRANT AND GOING The Legion continues to remove or widen the restrictions on Branch Property Trusts MAKING CONCERN that have served their purpose, so that these funds can be used more effectively Included in our welfare service The trustees have considered the and across the broader range of services expenditure are grants made to potential impact of the significant needed by those we support today. individuals in immediate need after control measures enacted by the UK During the year, decisions were made on an assessment of the person’s financial Government to fight the Covid-19 virus 30 Branch Property Trusts, resulting in situation. In 2019, The Royal British on the ability of the Group to continue £2.1 million (2018: £0.7 million) Legion spent £15.9 million on as a going concern for a period of at being moved into unrestricted funds. individual grants (2018: £12.2 million). least 12 months from the date of signing These funds, together with restricted Area In both volume and value, ‘mobility’- the accounts.

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 FINANCIAL REVIEW 210X297 84 3MM TRUSTEES’ REPORT

The most significant areas of financial At the start of the pandemic, the Legion that auditing is used as a tool to check impact across the Group are: had a strong and liquid balance the presence and effectiveness of Fundraising – income from individual sheet and our analysis shows that the controls. The Audit & Risk Committee supporters will likely decline due to Legion would remain a going concern receives copies of all audit reports. the cancellation of fundraising events, in the scenario described above. pressure on household finances and Furthermore, the Legion has high levels The Audit & Risk Committee, which is challenging conditions in the property of discretionary expenditure and could chaired by a trustee, scrutinises the and investment markets impacting reduce expenditure relatively quickly if management of risk and ensures that legacy income. Donations and trading the impact on our fundraising income is recommendations are acted upon. income at the National Memorial worse than expected. Arboretum will likely decline as The National Memorial Arboretum and public access to the site is restricted. The trustees have therefore concluded Poppyscotland are included in the risk Investments – the market value of that it remains appropriate to prepare framework and a consistent risk model the Group’s investments stood at these accounts on a going concern basis. is used. £166 million at 30 September 2019. Of this, the Cazenove portfolio At their last review, the trustees were accounted for £132 million. Following satisfied that appropriate and effective a period of intense stock market RISK controls are in place to mitigate risk volatility, the value of the Cazenove exposures. The most significant risks are portfolio stood at £123 million on MANAGEMENT set out below, together with selected 30 April 2020. The length of time controls from our risk register. control measures remain in place AND INTERNAL and the resulting economic impact will determine the speed at which CONTROL investment values recover. PUBLIC BENEFIT Pension deficit – the defined-benefit The Board of Trustees has responsibility pension deficits of the Group stood at for the oversight of risk management. The trustees have given due regard to £6.6 million at 30 September 2019. The Board requires risks to be identified, the public-benefit guidance published Whilst the deficit is likely to increase, assessed, managed, monitored and by the Charity Commission. They a reliable estimate of the impact cannot reported, with appropriate records believe that the extensive welfare be made at this time. The triennial maintained to evidence the process. support provided to our beneficiaries, valuation of the schemes is due to take along with the other charitable activities place as at 1 April 2020. It should be The Royal British Legion’s risk framework undertaken, satisfies the public-benefit noted that the pension deficit is a long- includes a risk-management policy and requirements of the Charities Act 2011. term liability, which will crystallise over defines the processes to be followed a number of years. to ensure that risk is managed appropriately. This is achieved as follows: We have forecast our income, SAFEGUARDING expenditure, gains and losses for the risks are owned by a senior executive, financial years ending 30 September usually an executive director; The Royal British Legion is engaged 2020 and 2021 using two scenarios. risks are required to have controls in in a wide range of beneficiary, Our more pessimistic scenario assumes place to provide effective mitigation; membership and community-facing that Poppy Appeal 2020 is significantly risk owners ensure that controls are activities, including direct welfare affected, overall fundraising income present and effective; support, fundraising and comradeship. reduces by 30 per cent and investment risk exposures are known and Specifically, the Legion provides values continue to decline to 30 understood by risk owners and are regulated and non-regulated activities September 2021, losing one third of reported formally each quarter; and that involve interaction with vulnerable their 30 September 2019 value. there is a strong link between risk adults and can often involve children. management and internal audit so Our staff, volunteers and members

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 FINANCIAL REVIEW 210X297 84 3MM Risk Mitigation

Covid-19 Pandemic • A serious incident response framework that prioritises the safety of all our Inability to deliver our mission and look after those people – beneficiaries, staff and volunteers we support due to the Covid-19 pandemic • High standards of infection prevention control in Care Homes • Robust IT infrastructure, enabling us to continue to support people remotely where possible • Ability to mobilise our extensive network of volunteers • A flexible approach to fulfilling our remit as the nation’s guardian of Remembrance • Prudent reserves policy and flexible approach to fundraising • Agile governance arrangements, enabling quick and effective decision making Financial Sustainability • Annual budget process Inability to deliver our mission and look after • Financial forecasting for short and medium term those we support because of the financial • Prudent reserves policy position of the Legion • Fundraising strategy • Fundraising income and expenditure reviewed monthly, and corrective action taken if there are significant variances to the budget • Sound basis for grant-funding decision-making

Safeguarding • Independently chaired Safeguarding Forum meets regularly throughout the year to A beneficiary, volunteer or employee suffers receive and act on management information harm, abuse or neglect • Appointment of a designated safeguarding lead • A Safeguarding Working Group is charged with ensuring safeguarding and related policies are embedded into processes • Separate safeguarding risk monitoring for key areas, such as Care Homes, staff and volunteers • Multi-level, mandatory training programme • Regular reporting of safeguarding data and risk exposures

Governance • Regular training for trustees Inability to deliver our strategic objectives due • Performance monitoring of trustees and Executive Board to ineffective leadership and governance • Implementation of defined Terms of Reference for Board of Trustees, Executive Board, and all Board Committees • Royal Charter review • Head of Governance with specific responsibility for ensuring governance arrangements are fit for purpose • Internal audit of governance arrangements • Trustees are appointed to fill specific skills gaps Sector Relationships • Executive Board oversight of critical relationships Our ability to deliver our strategic aim to be • Robust management of Veterans’ Gateway the ‘heart of a national network’ fails because • Strategic alliances properly managed and recorded of a lack of trust and collaboration with the rest of the sector

have a moral and legal responsibility concerns to statutory agencies and to ensure the safety of the people we recording all safeguarding incidents MODERN work with. Recognising our commitment on our Legion Assure reporting system. to ensure that those engaged with the In order to embed a culture of SLAVERY ACT Legion can live free from harm, abuse safeguarding awareness, the Legion or neglect, the charity has implemented delivers Level 1 safeguarding training 2015 a range of policies and procedures, to all staff and volunteers. The Board including a Safeguarding Policy, Code of Trustees also receives appropriate The Royal British Legion is committed of Conduct and robust recruitment safeguarding training. to ensuring that slavery and human procedures for staff and volunteers. trafficking do not occur in our operations or supply chain and will The Legion has a network of trained work with suppliers to ensure designated safeguarding leads, who are compliance with the Modern Slavery responsible for reporting safeguarding Act 2015. Our anti-slavery and human

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trafficking statement is published on the Hay job evaluation system, and only serve one term of three years; our website. this supports a process of pay however, the Vice-Chairman may also benchmarking. There is an independent serve one term of three years as Governance Committee comprised of National Chairman if so elected by trustees, which approves the annual pay voting branches. New trustees are given STRUCTURE, award and agrees the remuneration for induction training on their duties and the Director General and Director of responsibilities as members of the Board GOVERNANCE Finance and Commercial. of Trustees. Training needs are reviewed on an annual basis and specific training AND is given to trustees as required. MANAGEMENT BOARD OF Trustees receive no remuneration but are reimbursed for the cost of attending The Royal British Legion has a head TRUSTEES meetings and other official functions. office in London, where the Director Trustees are invited to lead and General and the supporting Board The Board of Trustees is responsible officiate on pilgrimages and the costs of five Executive Directors are based. for the overall governance, policy and involved in that duty are included There is a network of offices in work of The Royal British Legion. All in the declared figure for trustee England, Northern Ireland, Scotland substantive decisions are made by the expenses (Note 15). and Wales that provides facilities for Board of Trustees within the bounds of beneficiaries, members, volunteers and the Royal Charter and the Legion’s staff. Care Home services are delivered vision, mission and charitable objectives. through the Legion’s premises around The Board of Trustees provides overall COMMITTEES the country. The National Memorial strategic direction, while administration Arboretum, the home of the Armed of the charity is delegated to the Director OF THE BOARD Forces Memorial, is situated in Alrewas, General and through him to the Board Staffordshire, and the Legion’s Contact of Executive Directors. The Board of Trustees has eight Centre is based in Cardiff. Headquarters committees that report to it, all of which for Poppyscotland are located in The Board of Trustees meets eight times have written terms of reference. Edinburgh. The charity’s branches are per year and comprises 16 trustees: located throughout England, Wales, the National Chairman and National Two of the committees facilitate Northern Ireland, the Republic of Vice-Chairman are elected by membership matters: Ireland, the Channel Islands, the Isle of voting branches; Membership Council – has Man and overseas. seven trustees are elected by responsibility for the direction and voting branches; implementation of all membership The Legion’s governing document is six trustees are appointed by the issues; and its Royal Charter of Incorporation and Board of Trustees. Invitation is by Conference Committee – oversees the Schedules, which was first granted in open advertisement and selection organisation of the Annual Conference. 1925. The Board of Trustees has the takes place through the Governance responsibility for its implementation Committee; and Two committees form an integral part and review, but charter amendments the Chairman of the Women’s Section of the governance of the charity: require a special resolution at the is elected by the members of the Governance Committee – makes Annual Conference before they Women’s Section at the Women’s recommendations on trustee can be subsequently ratified by a Section National Conference. appointments, overall staffing special resolution of the Board of arrangements and monitors Trustees and allowed by Her Majesty Trustees are elected or appointed for an governance best practice; and the Queen in council. initial three-year period and are eligible Audit and Risk Committee – reviews for a further two terms of three years. the significant judgements made in Directors’ roles are evaluated using The Chairman and Vice-Chairman may the accounts before board approval.

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 FINANCIAL REVIEW 210X297 84 3MM It assures the board on the effectiveness shareholding and no other form of of internal controls, provides for CORPORATE control by the Legion. The results of regular communication between the these companies are therefore not trustees and the external and internal STRUCTURE included in the consolidated accounts auditors, monitors risk-management of the Legion. procedures, and approves the The Royal British Legion has an extensive internal audit programme. corporate structure comprising: the charity; Three committees oversee the resources 13 wholly owned subsidiaries, CONNECTIONS of the charity: nine of which are included in the Finance Committee – reviews, consolidated accounts and four of TO A recommends and monitors compliance which are dormant; and with the reserves and investment the Irish ex-Service Trust, for which NON-CHARITY policies, and provides oversight of it acts on behalf of Her Majesty’s IT. It reviews the annual budget, Government as the distributory agent. The trustees have applied the Charity oversees and monitors the investment Commission Guidance regarding portfolio and addresses any other Further details of the activities and connections to a non-charity and financial matters referred to it by the performance of subsidiaries are given confirm that they have addressed the Board of Trustees; in Note 14 to the accounts. risks of any connections. They regularly Property Committee – recommends monitor the connections to non-charities strategy and monitors performance In addition, there are four active to ensure that the charity’s resources in relation to functional property organisations that share part of are not applied to advance any developments, oversees significant our name: non-charitable interest. acquisitions or disposals, and ensures Royal British Legion Industries Limited these properties are appropriately (RBLI), which provides employment, maintained; and training and support for people, Branch Property Trusts (BPT) Trustee including those with disabilities, plus ROLE OF THE Committee – recommends strategy care and support for ex-Servicemen, and monitors compliance in relation women and families; MEMBERSHIP to the management of properties, Royal British Legion Poppy Factory income and assets held by the Limited in Richmond (the Poppy AND Branch Property Trusts, and approves Factory), which creates paid, property disposals. meaningful employment opportunities VOLUNTEERS for wounded, injured and sick Finally, the International Committee ex-Servicemen and women; The Royal British Legion is a membership represents the Legion as part of the The Royal British Legion Attendants organisation overseen by a Board of World Veterans’ Federation and advises Company Trust, which promotes the Trustees through the Membership the Board of Trustees on matters related rehabilitation and resettlement of men Council. Around 230,000 members are to the Legion’s international and women of Her Majesty’s Armed organised through approximately 2,500 relationships and activities. Forces who are in need of assistance branches operating across England, in civilian life; and Wales, Northern Ireland and the Isle The day-to-day management of the Royal British Legion Scotland, which of Man, with a further 95 branches charity is delegated to the Director helps Scottish ex-Servicemen and overseas and eight national branches. General and, through him, to the Board women of all ages to adapt to of Executive Directors. civilian life. BRANCHES: undertake local welfare activities These four companies are separate as part of the Branch Community charitable trusts with no common Support scheme;

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 FINANCIAL REVIEW 210X297 84 3MM TRUSTEES’ REPORT

undertake their own fundraising, with Guidance and advice on volunteer state whether applicable accounting central support for the Poppy Appeal; management and support is provided standards have been followed; and recruit and retain members; by the centrally based Volunteer prepare the financial statements on ensure that Remembrance is Support Unit (VSU). The VSU focuses a going concern basis unless it is undertaken locally; and on creating a flexible framework to inappropriate to presume that the act as Legion representatives in their develop volunteer opportunities and on charity will continue in business. local community. professionalising the experience of our Branches report into 53 Section, volunteers. Through our volunteering The trustees are responsible for keeping County and District committees, strategy, we are looking to build proper accounting records that disclose which consist entirely of volunteers. a two-way relationship with our with reasonable accuracy at any time The Legion provides operational volunteers, where how we support the financial position of the charity and administrative support to the and manage them is just as important and enable them to ensure that the membership structure delivered by the as how they support us. financial statements comply with the staff of the Membership Department Charities Act 2011 and the Charity and a network of Membership Support (Accounts and Reports) Regulations Officers located across England, Wales 2008. They are also responsible for and Northern Ireland. STATEMENT safeguarding the assets of the charity and hence for taking reasonable steps The Women’s Section provides care OF TRUSTEES’ for the prevention and detection of and support for the ex-Service community fraud and other irregularities. The through its own welfare schemes, such as RESPONSIBILITIES trustees are responsible for the financial support to ex-Service women; maintenance and integrity of the charity wives, widows and widowers of ex- The trustees are responsible for and financial information included on Service personnel; and their children. preparing the Trustees’ Annual Report the charity’s website. Legislation in and the financial statements in the United Kingdom governing the Many members of the Legion belong to accordance with applicable law and preparation and dissemination of one of the 405 clubs (2018: 417) that United Kingdom Accounting Standards financial statements may differ from use the Legion’s name under licence but (United Kingdom Generally Accepted legislation in other jurisdictions. are independent entities; therefore, their Accounting Practice) including FRS102 financial results are not included in these “The Financial Reporting Standard The Trustees’ Report (pages 8 to 49), accounts. There are 227 clubs (2018: applicable in the UK and Republic for and on behalf of the trustees 238) that occupy premises owned by of Ireland”. The law applicable to the Legion and leased to the club. charities in England and Wales requires the trustees to prepare The Legion depends on the dedication financial statements for each financial and commitment of thousands of year that give a true and fair view volunteers who give their time and of the state of affairs of the charity, of energy in supporting our charitable the incoming resources, and of the Una Cleminson, National Chairman objectives. Volunteers add value to application of resources of the charity 15 May 2020 almost every area of Legion activities, for that period. from casework and fundraising to improving the quality of life of our Care In preparing these financial statements, Home residents. The Legion has more the trustees are required to: than 120,000 volunteers contributing select suitable accounting policies and an estimated 2.5 million hours each then apply them consistently; year. This is potentially worth £18 observe the methods and principles million a year to the charity. More than in the Charities SORP; half of our volunteers undertake more make judgements and estimates that than one volunteer role in the Legion. are reasonable and prudent;

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 FINANCIAL REVIEW 210X297 84 3MM INDEPENDENT AUDITOR’S REPORT TO THE TRUSTEES OF THE ROYAL BRITISH LEGION

the consolidated and parent charity in accordance with these requirements. REPORT ON THE balance sheets; We believe that the audit evidence the consolidated and parent charity we have obtained is sufficient and AUDIT OF THE cash flow statements; and appropriate to provide a basis for FINANCIAL the related notes 1 to 33. our opinion. The financial reporting framework that CONCLUSIONS RELATING TO STATEMENTS has been applied in their preparation GOING CONCERN is applicable law and United Kingdom We are required by ISAs (UK) to OPINION Accounting Standards, including report in respect of the following In our opinion, the financial statements Financial Reporting Standard 102 matters where: of The Royal British Legion (the ‘charity’) “The Financial Reporting Standard the trustees’ use of the going concern and its subsidiaries (the ‘group’): applicable in the UK and Republic of basis of accounting in preparation give a true and fair view of the state Ireland” (United Kingdom Generally of the financial statements is not of the group’s and the parent charity’s Accepted Accounting Practice). appropriate; or affairs as at 30 September 2019 and the trustees have not disclosed in the of the group’s incoming resources BASIS FOR OPINION financial statements any identified and application of resources for the We conducted our audit in accordance material uncertainties that may cast year then ended; with International Standards on Auditing significant doubt about the group’s have been properly prepared in (UK) (ISAs (UK)) and applicable and the parent charity’s ability to accordance with United Kingdom law. Our responsibilities under those continue to adopt the going concern Generally Accepted Accounting standards are further described in the basis of accounting for a period of Practice, including Financial auditor’s responsibilities for the audit at least 12 months from the date Reporting Standard 102 “The of the financial statements section when the financial statements are Financial Reporting Standard of our report. authorised for issue. applicable in the UK and Republic of Ireland”; and We are independent of the group and We have nothing to report in respect have been prepared in accordance of the parent charity in accordance of these matters. with the Charities Act 2011. with the ethical requirements that are relevant to our audit of the financial OTHER INFORMATION We have audited the financial statements in the UK, including the The trustees are responsible for the statements, which comprise: Financial Reporting Council’s (the other information. The other information the consolidated and parent charity ‘FRC’s’) Ethical Standard, and we have comprises the information included statements of financial activities; fulfilled our other ethical responsibilities in the annual report other than the

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 FINANCIAL REVIEW 210X297 84 3MM financial statements and our auditor’s AUDITOR’S RESPONSIBILITIES statements is inconsistent in any report thereon. Our opinion on the FOR THE AUDIT OF THE material respect with the trustees’ financial statements does not cover FINANCIAL STATEMENTS report; or the other information and we do We have been appointed as auditor sufficient accounting records have not not express any form of assurance under section 151 of the Charities Act been kept by the parent charity; or conclusion thereon. 2011 and report in accordance with the parent charity financial statements the Act and relevant regulations made are not in agreement with the In connection with our audit of the or having effect thereunder. accounting records and returns; or financial statements, our responsibility we have not received all the is to read the other information and, Our objectives are to obtain reasonable information and explanations we in doing so, consider whether the other assurance about whether the financial require for our audit. information is materially inconsistent statements as a whole are free from with the financial statements or our material misstatement, whether due to We have nothing to report in respect of knowledge obtained in the audit or fraud or error, and to issue an auditor’s these matters. otherwise appears to be materially report that includes our opinion. misstated. If we identify such material Reasonable assurance is a high level USE OF OUR REPORT inconsistencies or apparent material of assurance, but is not a guarantee This report is made solely to the misstatements, we are required to that an audit conducted in accordance charity’s trustees, as a body, in determine whether there is a material with ISAs (UK) will always detect a accordance with Part 4 of the Charities misstatement in the financial statements material misstatement when it exists. (Accounts and Reports) Regulations or a material misstatement of the other Misstatements can arise from fraud 2008. Our audit work has been information. If, based on the work we or error and are considered material undertaken so that we might state to the have performed, we conclude that there if, individually or in the aggregate, charity’s trustees those matters we are is a material misstatement of this other they could reasonably be expected required to state to them in an auditor’s information, we are required to report to influence the economic decisions report and for no other purpose. To that fact. of users taken on the basis of these the fullest extent permitted by law, we financial statements. do not accept or assume responsibility We have nothing to report in respect of to anyone other than the charity and these matters. A further description of our the charity’s trustees as a body, for our responsibilities for the audit of the audit work, for this report, or for the RESPONSIBILITIES OF TRUSTEES financial statements is located on the opinions we have formed. As explained more fully in the trustees’ FRC’s website at: www.frc.org.uk/ responsibilities statement, the trustees auditorsresponsibilities. This description are responsible for the preparation forms part of our auditor’s report. of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is REPORT Deloitte LLP necessary to enable the preparation Statutory Auditor of financial statements that are free ON OTHER London, United Kingdom from material misstatement, whether 15 May 2020 due to fraud or error. LEGAL AND Deloitte LLP is eligible for appointment as auditor for the charity by virtue of its eligibility for appointment In preparing the financial statements, REGULATORY as audit of a company under section 1212 of the the trustees are responsible for assessing Companies Act 2006. the group’s and the parent charity’s REQUIREMENTS ability to continue as a going concern, disclosing, as applicable, matters MATTERS ON WHICH WE related to going concern and using ARE REQUIRED TO REPORT the going-concern basis of accounting BY EXCEPTION unless the trustees either intend to Under the Charities (Accounts and liquidate the group or the parent charity, Reports) Regulations 2008, we are or to cease operations, or have no required to report in respect of the realistic alternative but to do so. following matters if, in our opinion: the information given in the financial

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 FINANCIAL REVIEW 210X297 84 3MM FINANCIALS

The Royal British Legion Consolidated Statement of Financial Activities for the year ended 30 September 2019

Note Unrestricted Restricted Total Total funds funds 2019 2018 2019 2019 £’000 £’000 £’000 £’000 Income and endowments from Donations and legacies 4 93,801 7,516 101,317 96,569 Charitable activities 5 21,809 22,806 44,615 36,453 Other trading activities 6 20,183 2,756 22,939 23,536 Investments 7 2,719 3,902 6,621 6,146 Other - 391 391 474 Total income 138,512 37,371 175,883 163,178

Expenditure on Raising funds 8 36,867 6,624 43,491 41,726 Charitable activities Care 9 34,061 690 34,751 33,260 Personnel Recovery Centres 9 2,394 102 2,496 2,321 Community Welfare 9 46,727 16,997 63,724 56,939 Membership 9 7,900 1,118 9,018 8,525 Comradeship 9 595 - 595 538 Communications and campaigning 9 12,806 - 12,806 12,605 Remembrance and ceremonial 9 2,258 12,544 14,802 9,379 Total charitable activities 9 106,741 31,451 138,192 123,567 Total expenditure 143,608 38,075 181,683 165,293

Net expenditure before investment gains (5,096) (704) (5,800) (2,115) Net gains on disposal of investments 1,094 2,791 3,885 2,352 Unrealised gains on revaluation of investments 4,669 4,899 9,568 11,162 Net income before tax 667 6,986 7,653 11,399 Taxation credit 11 2 - 2 - Net income for the year 669 6,986 7,655 11,399 Transfers between funds 30 5,963 (5,963) - -

Other recognised (losses)/gains Actuarial gains on defined-benefit pension schemes 16a (1,446) (41) (1,487) 2,457

Net movement in funds 5,186 982 6,168 13,856

Fund balances brought forward at 1 October 183,648 181,992 365,640 351,784

Fund balances carried forward at 30 September 188,834 182,974 371,808 365,640

The notes on pages 56 to 82 form part of the financial statements. All amounts relate to continuing operations, and all gains and losses recognised in the year are included in the Statement of Financial Activities.

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 FINANCIALS 210X297 84 3MM The Royal British Legion Charity Statement of Financial Activities for the year ended 30 September 2019

Note Unrestricted Restricted Total Total funds funds 2019 2018 2019 2019 £’000 £’000 £’000 £’000 Income and endowments from Donations and legacies 4 96,883 1,839 98,722 96,426 Charitable activities 5 24,185 19,437 43,622 34,005 Other trading activities 6 5,273 11 5,284 6,123 Investments 7 2,719 3,432 6,151 5,747 Other - 356 356 398 Total income 129,060 25,075 154,135 142,699

Expenditure on Raising funds 8 28,121 17 28,138 29,408 Charitable activities Care 9 34,061 690 34,751 33,260 Personnel Recovery Centres 9 2,394 102 2,496 2,321 Community Welfare 9 48,938 12,044 60,982 60,428 Membership 9 7,900 1,054 8,954 8,480 Comradeship 9 595 - 595 538 Communications and campaigning 9 12,806 - 12,806 12,236 Remembrance and ceremonial 9 2,258 8,879 11,137 5,612 Total charitable activities 9 108,952 22,769 131,721 122,875 Total expenditure 137,073 22,786 159,859 152,283

Net (expenditure)/income before investment gains (8,013) 2,289 (5,724) (9,584) Net gains on disposal of investments 1,094 2,791 3,885 2,347 Unrealised gains on revaluation of investments 4,669 4,414 9,083 11,210 Net (expenditure)/income for the year (2,250) 9,494 7,244 3,973 Transfers between funds 30 8,270 (8,270) - - Transfer to newly incorporated subsidiary 14 - - - -

Other recognised (losses)/gains Actuarial gains on defined-benefit pension scheme 16a (1,446) - (1,446) 2,266

Net movement in funds 4,574 1,224 5,798 6,239

Fund balances brought forward at 1 October 180,530 142,581 323,111 316,872

Fund balances carried forward at 30 September 185,104 143,805 328,909 323,111

The notes on pages 56 to 82 form part of the financial statements. All amounts relate to continuing operations, and all gains and losses recognised in the year are included in the Statement of Financial Activities.

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 FINANCIALS 210X297 84 3MM

The Royal British Legion Consolidated and Charity Balance Sheets as at 30 September 2019

Note Group Group Charity Charity 2019 2018 2019 2018 £’000 £’000 £’000 £’000 Fixed assets Intangible assets 17 4,192 3,665 4,192 3,665 Tangible assets 18 98,188 94,792 75,960 73,031 Investments 19 165,895 156,195 152,574 144,232 Investment properties 20 65,019 66,682 65,019 66,682 Programme-related investments 21 5,008 5,588 5,008 5,611 Total fixed assets 338,302 326,922 302,753 293,221

Current assets Stocks 2,393 1,703 - - Debtors 22 16,729 15,116 18,041 17, 7 9 0 Cash at hand and in bank 23 59,231 6 7, 75 3 48,014 53,613 Total current assets 78,353 84,572 66,055 71,403

Current liabilities Creditors: Amounts falling due within one year 24 (32,519) (31,467) (29,382) (28,873) Net current assets 45,834 53,105 36,673 42,530 Total assets less current liabilities 384,136 380,027 339,426 335,751 Creditors: Amounts falling due after more than one year 24 (5,201) (9,832) (5,201) (9,832) Provisions for liabilities 26 (494) (487) (494) (487) Net assets excluding pension liability 378,441 369,708 333,731 325,432 Defined-benefit pension liability 16b (6,633) (4,068) (4,822) (2,321) Net assets 371,808 365,640 328,909 323,111

Funds Total unrestricted funds 28 188,834 183,648 185,104 180,530 Total restricted funds 29 182,974 181,992 143,805 142,581 Total funds 371,808 365,640 328,909 323,111

The notes on pages 56 to 82 form part of the financial statements. The financial statements of The Royal British Legion, registered charity no. 219279, were approved by the Board of Trustees and authorised for issue on 15 May 2020. These were signed on its behalf by:

Una Cleminson National Chairman

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 FINANCIALS 210X297 84 3MM FINANCIALS

The Royal British Legion Cash Flow Statement for the year ended 30 September 2019

Group Group Charity Charity 2019 2018 2019 2018 Note £’000 £’000 £’000 £’000 Net cash absorbed by operating activities A (12,719) (4,491) (11,283) (11,688) Cash flows from investing activities Dividends, interest and rents from investments 6,621 6,146 6,151 5,747 Proceeds from the sale of tangible fixed assets - - - - Purchase of tangible fixed assets (6,650) (8,287) (5,534) (1,956) Purchase of intangible fixed assets (1,222) (1,212) (1,222) (1,212) Proceeds from sale of investments 7,548 4,877 7,548 4,877 Purchase of investments (2,100) (3,312) (1,259) (3,512) Net cash provided by investing activities 4,197 (1,788) 5,684 3,944 Change in cash and cash equivalents in the year (8,522) (6,279) (5,599) ( 7, 74 4 ) Cash and cash equivalents at the beginning of the year 67,753 74,032 53,613 61,357 Cash and cash equivalents at the end of the year 23 59,231 6 7, 75 3 48,014 53,613

Group Group Charity Charity 2019 2018 2019 2018 £’000 £’000 £’000 £’000 A. Reconciliation of net income to net cash flow from operating activities Net income for the year (as per the Statement of Financial Activities) 7,655 11,39 9 7,244 3,973 Adjustments for: Depreciation, amortisation and impairment charges 3,888 3,713 3,294 3,231 Gains on investments (13,453) (13,514) (12,968) (13,557) Dividends, interest and rents from investments (6,621) (6,146) (6,151) (5,747 ) Loss on sale of tangible fixed assets 29 - 6 - (Increase)/decrease in stock (690) 756 - - Decrease in programme-related investments 580 576 603 576 (Increase)/decrease in debtors (1,613) (146) (251) 467 (Decrease)/increase in creditors (3,579) (1,345) (4,122) (823) (Decrease)/increase in provisions 7 (132) 7 (132) Adjustment in respect of pension funding 1,078 348 1,055 324 Net cash absorbed by operating activities (12,719) (4,491) (11,283) (11,688 )

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 FINANCIALS 210X297 84 3MM

The Royal British Legion Notes to the Accounts for the year ended 30 September 2019

1 PRINCIPAL specific purposes and which must be used for that commercial (trading) activities and investment purpose. All restricted funds are held within the management fees. ACCOUNTING POLICIES Benevolent fund unless otherwise stated. Restricted • C haritable activities includes expenditure directly funds include permanent endowment funds, which related to the delivery of the services (including Accounting convention are not material and are not therefore shown staff costs) provided by the charity to eligible The financial statements have been prepared separately on the face of the balance sheet. The beneficiaries, and includes the cost of residential in accordance with United Kingdom Generally funds of The National Memorial Arboretum Company care, welfare Break Centres, community welfare Accepted Accounting Practice, including the Limited and its subsidiary (NMA (Enterprises) Limited), services, and Remembrance and comradeship. ‘Statement of Recommended Practice applicable to the Earl Haig Fund Scotland and the Lady Haig It also includes the cost of supporting and charities preparing their accounts in accordance Poppy Factory (Poppyscotland Group), and the Royal maintaining the Legion’s extensive membership with the Financial Reporting Standard applicable British Legion Republic of Ireland, are held within and the costs of campaigning on behalf of in the UK and Republic of Ireland (FRS 102)’, and restricted funds since their objects are narrower than beneficiaries. The cost of evaluating, supporting applicable UK law. The financial statements are those of The Royal British Legion group. and managing charitable programmes is also prepared on an accruals basis except that the results included and further analysed in the notes to from branches have been extracted from returns Income the accounts. submitted on a receipts and payments basis. The Income is recognised in the year in which the Legion • C ertain campaign costs are allocated between branch financial year runs from 1 July to 30 June. is entitled to receipt of that income and when the Cost of raising funds and Charitable activities The branch results included in these accounts amount can be measured with reasonable accuracy. on the basis of the percentages of space within are for the year to 30 June 2019, with prior year In accordance with this policy: the literature relating to fundraising and raising comparatives (2018) for the year to 30 June 2018. awareness respectively. • Le gacies are included as follows: Pecuniary • S upport costs include the central functions, such The group meets the definition of a public benefit legacies are recognised when the legacy has been as general management, financial administration, entity under FRS 102 and the financial statements received or if, before receipt, there is sufficient information technology, human resources, have been prepared under the historical cost evidence to provide the necessary certainty that governance and facilities management. convention, unless otherwise stated in the relevant the legacy will be received. Residual legacies are accounting policy note. recognised on receipt of Estate Accounts. Legacies Grants payable are recognised in the Statement of subject to a life interest held by another party are Financial Activities when awarded and the recipient Group financial statements not recognised. has a valid expectation of receipt, thus creating a These financial statements comprise the central • G rants are included when the conditions for constructive or legal obligation. General and Benevolent funds vested in the Board recognition have been complied with. of Trustees in accordance with The Royal British • D onations are accounted for in the year of receipt. Future grant expenditure commitments are included Legion’s (“the Legion”) Royal Charter. As agreed Poppy Appeal donations are accounted for within creditors on the balance sheet at their net with the Charity Commission and in accordance when banked. present value, using a discount rate equivalent to the with FRS 102, they include the results, assets and • F undraising lottery income is recognised when the yield on Treasury Gilts over the period of the grant. liabilities of the Legion’s counties, districts, branches lottery draw has taken place. Income received in and Women’s Section. The Legion’s policy is to advance for future lottery draws is deferred until Allocation of costs consolidate results of all branches, counties and the lottery draw takes place. Where possible, the Legion’s operating costs, districts based upon receipt of individual returns. • eesF from residential Care Homes are recognised which include staff costs, are allocated directly to Where returns are not received, assets are included on an accruals basis. the various categories of charitable expenditure or at the previously reported value adjusted for known • M embership fees are recognised on an cost of raising funds. Where costs are not directly transactions. The subsidiaries and organisations accruals basis. attributable to any category, they have been listed in note 14 have been consolidated on a • Investment income from the centrally held apportioned on an appropriate basis to reflect, in line-by-line basis. investment portfolio is accounted for on an accruals each case, an estimate of the efforts and resources basis and includes dividends declared but not yet devoted to each category of activity – see note 13. Four organisations that carry the Legion’s name received. Investment income includes rental income Activities that are predominantly outsourced bear but are not controlled by the Legion have not been earned by branches. no allocation of support costs. included in these financial statements, namely, Royal • I ncome received through branches from fundraising British Legion Industries, The Royal British Legion and other activities is recognised for branches Stock, poppies and wreaths Poppy Factory Limited, The Royal British Legion on the basis of branch returns for the year to The majority of stock relates to Poppy Shop products Attendants Company Trust and Royal British Legion 30 June 2019. held for resale by Royal British Legion Trading Ltd. Stock Scotland. The accounts do not include the results of The economic value of time given by volunteers is not also includes poppies and wreaths produced at the affiliated social clubs, which are not controlled by the included in these financial statements. Lady Haig Poppy Factory which are manufactured for charity but are separately registered organisations external resale. Stock is valued at the lower of cost and licensed to use the Legion’s name. Expenditure net realisable value, and includes direct costs of labour Expenditure is accounted for on an accruals basis. and materials, plus allocation of general overheads. Fund accounting Irrecoverable VAT is included with the expense items Poppies and wreaths produced for distribution during Unrestricted funds are expendable at the to which it relates. Expenditure comprises: the Poppy Appeal are expensed immediately. discretion of the trustees in furtherance of the • C ost of raising funds includes expenditure on objects of the charity. poppies and other fundraising items, staff and Staff pension schemes Restricted funds represent grants, donations, legacies related expenditure of the Poppy Appeal, There are three staff pension schemes, which are and property which are given by the donor for costs of the central fundraising department, accounted for in accordance with FRS 102 section 28.

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ROYAL BRITISH LEGION ANNUAL REPORT • 2019 FINANCIALS 210X297 84 3MM FINANCIALS

These are the Royal British Legion Staff Pension Fund (a Plant, machinery and equipment where capitalised qualify as basic financial instruments. Basic financial defined-benefit scheme closed to future accrual), the Earl is included at cost. Depreciation is provided over instruments are initially recognised at transaction Haig Defined Benefit Scheme, and the Group Flexible 5 years from the month of first use. price (including transaction costs) and subsequently Retirement Plan (a defined-contribution scheme). Further measured at their settlement value. details are included in note 16 to the accounts. Software, databases and licences where capitalised are included at cost, which includes the cost of Trade and other debtors are recognised at the For the defined-benefit schemes, valuations are internal development where applicable. Depreciation settlement amount due after any discount offered undertaken by an independent actuary. The current is provided over 5 years from the month of first use. and net of any bad debt provision. Prepayments service costs of the Earl Haig Defined Benefit Scheme are valued at the amount prepaid net of any are charged to employee costs over the anticipated Tangible and intangible fixed assets that are trade discounts due. Creditors and provisions are period of employment. Net pension finance income under construction are classified as Assets Under recognised where the group has a present obligation or costs are included immediately in other income or Construction and are transferred into the resulting from a past event that will probably result employee costs as appropriate. Actuarial gains and appropriate category on completion, when in the transfer of funds to a third party, and the losses are recognised immediately on the face of the depreciation then commences. amount due to settle the obligation can be measured Statement of Financial Activities. The Legion’s share or estimated reliably. Creditors and provisions are of the scheme deficits is included as a liability on the The useful economic lives and residual lives of fixed normally recognised at their settlement amount after balance sheet. assets are reviewed at the end of each accounting allowing for any trade discounts due. year to consider whether there has been an For the defined-contribution scheme, the amount charged impairment. Impairments are charged to the Statement to the Statement of Financial Activities represents the of Financial Activities. employer contributions payable for the year. 2 CRITICAL ACCOUNTING Heritage assets JUDGEMENTS AND Investments and bank deposits The Armed Forces Memorial (AFM) is included as Fixed-asset investments are stated at market value. a heritage asset in the accounts of The National KEY SOURCES Gains and losses arising from either the change in Memorial Arboretum Company Limited at a nominal market value or on sale are included in the Statement value of £1. The trustees consider that the cost of OF ESTIMATION of Financial Activities. Income from listed investments ascertaining a definite value through a surveyor’s is accrued when due for payment. Interest on deposits valuation significantly outweighs the benefit gained UNCERTAINTY is accrued on a daily basis. from such a valuation. In application of the accounting policies, which are described in note 1, the trustees are required to Properties not used for charitable purposes are Finance and operating leases make judgements, estimates and assumptions about classified as investment properties and are included Instalments payable under operating leases are the carrying amounts of assets and liabilities that are in investments at market value. Investment properties charged to the Statement of Financial Activities on not readily apparent from other sources. The estimates are revalued on a rolling five-year basis, with 20% of a straight-line basis over the period of the lease. and associated assumptions are based on historical properties being revalued each year by an external Any lease incentives (such as rent-free periods) are experience and other factors that are considered to be qualified surveyor. The remaining 80% of properties spread over the life of the lease. The group does relevant. Actual results may differ from these estimates. are reviewed for material changes. not have any finance leases. The estimates and underlying assumptions are reviewed Programme-related investments are held at the Taxation on an ongoing basis. Revisions to accounting estimates amount invested less any impairment. These are The activities of the Legion and its charitable are recognised in the year in which the estimate is reviewed on an annual basis and any impairment subsidiaries are exempt from corporation tax under revised if the revision affects only that year, or in the is immediately recognised in the Statement of Chapter 3 of Part 11 of the Corporation Tax Act 2010, year of the revision and future years if the revision Financial Activities. to the extent that they are applied to the organisation’s affects both current and future years. charitable objects. The trading subsidiaries do not Tangible and intangible fixed assets generally pay UK corporation tax because their policy The trustees consider there to be only one potential Purchases of individual tangible and intangible fixed is to pay their taxable profits as Gift Aid to the Legion. source of critical judgement or key source of assets costing more than £50,000, or purchases estimation uncertainty requiring disclosure that is related to capital projects costing more than £50,000 Foreign exchange not already described within note 1, this being the in total, are capitalised. The Legion has no significant exposure to foreign emergence and subsequent spread of Covid-19. exchange gains or losses. Foreign branches Whilst this does not impact the figures included Functional properties (freehold and leasehold) used and districts make returns once a year and their in these financial statements drawn up as at 30 by the charity are included at cost, where known, or results, along with those of the Royal British Legion September 2019, the control measures implemented valuation at date of acquisition. Branch properties Republic of Ireland, are included in these accounts, by governments and their impact on the global acquired or gifted before 1 October 1995, where the converted to sterling at the exchange rate as at economy have led the trustees to review and original cost cannot be established, are included at a 30 September 2019. confirm the group’s ability to continue as a going nominal value of £1 each. Depreciation on functional concern for at least 12 months from the date of properties is provided on the cost of buildings on a Financial instruments signing these accounts. Further details are provided straight-line basis over 50 years or the term of the lease Financial assets and financial liabilities are recognised in the Financial Review and in note 32. if less. Leasehold improvements are depreciated over the when the group becomes a party to the contractual term of the lease. The head office building, Haig House, provisions of the instrument. The group only has is depreciated over its expected useful life of 32 years. financial assets and financial liabilities of a kind that

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3 Consolidated Comparative Statement of Financial Activities Unrestricted Restricted Total funds funds 2018 2018 2018 £’000 £’000 £’000 Income and endowments from Donations and legacies 91,519 5,050 96,569 Charitable activities 21,792 14,661 36,453 Other trading activities 20,475 3,061 23,536 Investments 2,910 3,236 6,146 Other 236 238 474 Total income 136,932 26,246 163,178

Expenditure on Raising funds 36,286 5,440 41,726 Charitable activities Care 32,418 842 33,260 Personnel Recovery Centres 2,239 82 2,321 Community welfare 40,845 16,094 56,939 Membership 7,821 704 8,525 Comradeship 538 - 538 Communications and campaigning 12,605 - 12,605 Remembrance and ceremonial 3,949 5,430 9,379 Total charitable activities 100,415 23,152 123,567 Total expenditure 136,701 28,592 165,293

Net income/(expenditure) before investment gains 231 (2,346) (2,115) Net gains on disposal of investments 112 2,240 2,352 Unrealised gains on revaluation of investments 1,931 9,231 11,162 Net income before tax 2,274 9,125 11,39 9 Taxation credit - - - Net income for the year 2,274 9,125 11,39 9 Transfers between funds ( 7,18 8 ) 7,18 8 -

Other recognised gains Actuarial gains on defined-benefit pension schemes 2,266 191 2,457

Net movement in funds (2,648) 16,504 13,856

Fund balances brought forward at 1 October 186,296 165,488 351,784

Fund balances carried forward at 30 September 183,648 181,992 365,640

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3a Charity Comparative Statement of Financial Activities Unrestricted Restricted Total funds funds 2018 2018 2018 £’000 £’000 £’000

Income and endowments from Donations and legacies 95,481 945 96,426 Charitable activities 25,715 8,290 34,005 Other trading activities 6,111 12 6,123 Investments 2,910 2,837 5,747 Other 236 162 398 Total income 130,453 12,246 142,699

Expenditure on Raising funds 29,383 25 29,408 Charitable activities Care 32,418 842 33,260 Personnel Recovery Centres 2,239 82 2,321 Community welfare 49,238 11,19 0 60,428 Membership 7,821 659 8,480 Comradeship 538 - 538 Communications and campaigning 12,236 - 12,236 Remembrance and ceremonial 3,949 1,663 5,612 Total charitable activities 108,439 14,436 122,875 Total expenditure 137,822 14,461 152,283

Net expenditure before investment gains ( 7, 3 6 9 ) (2,215) (9,584) Net gains on disposal of investments 112 2,235 2,347 Unrealised gains on revaluation of investments 1,931 9,279 11,210 Net (expenditure)/income for the year (5,326) 9,299 3,973 Transfers between funds 1,303 (1,303) -

Other recognised gains Actuarial gains on defined-benefit pension scheme 2,266 - 2,266

Net movement in funds (1,757) 7,9 9 6 6,239

Fund balances brought forward at 1 October 182,287 124,585 316,872

Fund balances carried forward at 30 September 180,530 142,581 323,111

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4 Donations and legacies Group Group Charity Charity 2019 2018 2019 2018 £’000 £’000 £’000 £’000 Voluntary income Donations 24,570 23,437 25,547 26,356 Legacies 21,794 22,638 21,274 22,472 The Poppy Appeal 54,953 50,494 51,901 4 7, 5 9 8 Total donations and legacies 101,317 96,569 98,722 96,426

The total of the Poppy Appeal launched in October 2018 in England, Wales and Northern Ireland was £51.901 million (2018: £47.598 million). This includes cash collected of £48.231 million (2018: £44.428 million), legacies of £366,000 (2018: £610,000) and other donations of £3.304 million (2018: £2.560 million). The Poppy Appeal in Scotland raised £2.948 million (2018: £2.818 million), and a further £104,000 (2018: £78,000) was raised by the Royal British Legion Republic of Ireland. In 1922, the Officers’ Association transferred the Poppy Appeal to the Legion in return for a payment of 7.5% of the net annual amount received from street collections. The Agreement under which this occurred expired on 13 March 2019. A new agreement was reached with the Officers’ Association under which the Legion has committed to paying a total grant of £6.7 million through annual instalments until March 2023. This agreement provides for payments to cease after this point. The new total grant due to the Officers’ Association of £6.7 million (2018: £2.059 million) is therefore recognised as expenditure this year in place of the annual percentage grant recorded in 2018 and prior years – see note 10. At 30 September 2019, the Legion had been advised of its interest in residuary and pecuniary legacies, with estimated values of £1.05 million (2018: £735,000), and these are included in the accounts. Not included in the accounts are interests in life-interest legacies with a value of £783,000 (2018: £323,000), where the conditions for acceptance had not been met. The Legion has also been notified of legacies estimated at a potential value of £13.52 million (2018: £15.085 million), which have not been recognised in these accounts. These legacies are a mixture of residuary legacies where confirmation of entitlement has not been received and the value cannot be confirmed at the balance sheet date, and pecuniary legacies where confirmation of entitlement has not been received as the executor has not confirmed sufficient funds will exist in the estate once realised. Included in Donations above is pro bono legal support of £107,500 (2018: £125,000) from J A Kemp, Mayer Brown LLP, Withers LLP, Bluefin Insurance Services and RSA. Also included are other benefits-in-kind valued at £90,000 (2018: £159,000).

5 Charitable activities Group Group Charity Charity 2019 2018 2019 2018 £’000 £’000 £’000 £’000

Grants for welfare services and Remembrance Aged Veterans’ Healthy Living Programme and Veterans Medical Fund 7, 2 0 0 2,518 7, 2 0 0 2,518 Grant from Poppy Lottery - - 2,376 3,923 Ex-Service charities and other organisations (almonisation) 2,790 2,693 2,625 2,548 Contributions for Remembrance activities 10,575 2,791 9,095 1,691 Grants towards capital projects 20 3,143 - - Other grants and contributions 1,492 2,921 416 1,259 Total grants for welfare services and Remembrance 22,077 14,066 21,712 11,939

Fees from residential Care Homes 17,147 16,833 17,147 16,833 Membership fees 4,402 4,577 4,401 4,574 Income from charitable services 989 977 362 659 Total other income from charitable activities 22,538 22,387 21,910 22,066

Total income from charitable activities 44,615 36,453 43,622 34,005

Almonisation income is the contribution from other charities towards Immediate Needs Grants paid by the Legion when the recipient of assistance is also a beneficiary of these other charities.

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6 Other trading activities Group Group Charity Charity 2019 2018 2019 2018 £’000 £’000 £’000 £’000 Fundraising events income 2,526 3,029 2,519 2,864 Fundraising lotteries 8,351 8,720 2,215 2,629 Income from commercial activities 11, 526 11,20 6 14 49 Licence fees and royalties 94 120 94 120 Advertising in the Legion magazine 442 461 442 461 Total income from other trading activities 22,939 23,536 5,284 6,123

7 Investment income Group Group Charity Charity 2019 2018 2019 2018 £’000 £’000 £’000 £’000 Dividends and interest on listed investments 2,998 2,822 2,540 2,445 Investment income on funds held by branches 696 567 696 567 Rentals from investment properties 2,472 2,373 2,471 2,358 Bank deposit interest 455 384 444 377 Total investment income 6,621 6,146 6,151 5,747

Rentals from investment properties with a market value of £65.019 million (note 20) at 30 September 2019 (2018: £66.682 million) are, in most cases, received by branches in relation to the rental of properties by Legion clubs. The clubs are independent entities that use the Legion’s name under licence and promote the work of the Legion in return for discounted rentals, which in many cases are lower than could be obtained in a commercial environment.

8 Cost of raising funds Group Group Charity Charity 2019 2018 2019 2018 £’000 £’000 £’000 £’000 Donations costs 9,380 7,969 6,944 5,781 Legacies costs 1,835 2,730 1,795 2,697 Poppy Appeal costs 14,225 15,022 13,469 14,384 Cost of raising voluntary income 25,440 25,721 22,208 22,862 Fundraising events costs 3,340 3,983 3,308 3,959 Fundraising lotteries costs 5,929 4,088 2,130 2,238 Commercial activities (trading) 8,333 7, 5 8 6 43 1 Cost of activities to raise funds 17, 6 0 2 15,657 5,481 6,198 Investment management 449 348 449 348 Total cost of raising funds 43,491 41,726 28,138 29,408

The total cost of raising funds for the group of £43.491 million (2018: £41.726 million) includes direct costs of £37.005 million (2018: £37.019 million) and allocated support costs of £4.957 million (2018: £4.707 million). Allocated support costs are described in further detail in note 13. Certain direct costs of campaigns have a parallel purpose of increasing public awareness and fundraising, and as a result, these costs have been allocated between the cost of raising funds in note 8 and charitable activities in note 9 on the basis of the percentages of space within the literature relating to fundraising and raising awareness respectively. The total expenditure of this nature is £8.052 million (2018: £9.128 million), of which £5.261 million (2018: £6.257 million) remains within cost of raising funds representing the fundraising element of the literature, and £2.791 million (2018: £2.871 million) has been reallocated into charitable activities representing the raising-awareness element.

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9 Analysis of charitable activities Note Group Group Charity Charity 2019 2018 2019 2018 £’000 £’000 £’000 £’000

Residential Care Homes 28,562 26,728 28,562 26,728 Welfare Break Centres 6,189 6,532 6,189 6,532 Total care 34,751 33,260 34,751 33,260

Personnel Recovery Centres 2,496 2,321 2,496 2,321

Welfare grants to individuals 15,903 12,201 14,957 11,357 Grants to other organisations 10 12,687 9,499 12,213 14,971 Information, advice and support 31,661 32,282 30,339 31,163 Welfare cost in branches, counties and districts 3,473 2,957 3,473 2,937 Total community welfare 63,724 56,939 60,982 60,428

Central membership support 4,503 4,682 4,504 4,637 Recruitment, development, training 568 510 568 510 Support to branches with clubs 229 173 229 173 The Legion magazine 846 655 846 655 Membership costs in branches, counties and districts 2,872 2,505 2,807 2,505 Total membership 9,018 8,525 8,954 8,480

Comradeship 595 538 595 538

Direct cost of communication and campaigning 10,015 9,734 10,015 9,734 Allocated cost of communication and campaigning 2,791 2,871 2,791 2,502 Total communication and campaigning 12,806 12,605 12,806 12,236

Festival of Remembrance 826 778 826 778 Ceremonial and commemorative events 9,775 3,581 9,710 3,517 Remembrance tours 601 1,041 601 1,041 National Memorial Arboretum operating costs 3,600 3,979 - 276 Total Remembrance and ceremonial 14,802 9,379 11,137 5,612

Total cost of charitable activities 138,192 123,567 131,721 122,875

The total cost of charitable activities for the group of £138.192 million (2018: £123.567 million) includes direct costs of £118.629 million (2018: £104.546 million) and allocated support costs of £19.563 million (2018: £19.021 million). Allocated support costs are described in further detail in note 13. As stated in note 8, the cost of charitable activities includes an allocation of £2.791 million (2018: £2.871 million), relating to costs associated with space within campaign literature relating to raising awareness.

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10 Grants awarded to other organisations Note Group Group Charity Charity 2019 2018 2019 2018 £’000 £’000 £’000 £’000 Grants awarded by the Charity The Officers’ Association 4 6,700 2,059 6,700 2,059 Personnel Recovery Centres 204 518 204 518 Combat Stress 1,550 - 1,550 - Help for Heroes 600 - 600 - National Memorial Arboretum - - 1,192 6,999 Poppyscotland - - 1,019 1,395 The Poppy Factory - 1,035 - 1,035 X-Forces - 464 - 464 Grants to 34 other charities and voluntary organisations (2018: 117) 948 2,501 948 2,501

Grants awarded by Poppyscotland Unforgotten Forces 1,384 1,714 - - Citizens Advice Scotland 551 501 - -

Grants to 11 other charities and voluntary organisations (2018: 16) 693 662 - -

Grants awarded by the Royal British Legion Republic of Ireland Grants to 4 charities and voluntary organisations awarded (2018: 4) 57 45 - -

Total grants to other organisations 12,687 9,499 12,213 14,971

Grants awarded may relate to commitments for multiple future years. For more information on grant commitments, see note 25.

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11 Ta xa t i o n Group Group 2019 2018 £’000 £’000 Current tax credit: UK corporation tax (2) - Total tax credit on income (2) -

The taxation credits and charges above arise in the trading subsidiary operations.

The differences between the total tax charge shown above and the amount calculated by applying the standard rate of UK corporation tax to the surplus before tax in the trading subsidiary operations is as follows:

Group Group 2019 2018 £’000 £’000 Surplus on ordinary activities before tax 4,371 3,677 Surplus on ordinary activities multiplied by applicable rate of corporation tax of 19% (2018: 19%) 831 699 Effects of: Post-balance sheet event: effect of Gift Aid donations (see note 32) (833) (699) Tax credit not recognised due to uncertainty over future profits 1

Tax credit for the year (2) -

12 Net incoming resources for the year is stated after charging: Group Group Charity Charity 2019 2018 2019 2018 £’000 £’000 £’000 £’000

Fees payable to the charity’s auditor for the audit of the charity’s annual accounts 161 155 161 155 Fees payable to the charity’s auditor for the audit of the subsidiaries’ 97 94 - - annual accounts Fees payable to the charity’s auditor for other services: Assurance services other than audit or independent examination 2 2 1 1 Tax advisory services 8 8 2 2 Other advisory services - - - - Branch, county and district audit and examination fees 41 41 41 41 Depreciation, amortisation and impairment charges 3,888 3,713 3,294 3,231 Rentals under operating leases 2,982 3,205 2,901 3,139

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13 Support costs Head Office Facilities Human Finance Governance Total Subsidiaries Total Central Management Resources and IT 2019 Charity 2019 Group 2019 2019 2019 2019 £’000 2019 £’000 2019 £’000 £’000 £’000 £’000 £’000 £’000

Donations costs 102 130 115 604 43 994 534 1,528 Legacies costs 35 44 39 204 15 337 10 347 Poppy Appeal costs - 314 279 1,461 104 2,158 209 2,367 Fundraising events costs 47 60 53 278 20 458 27 485 Fundraising lotteries costs 24 30 27 139 10 230 - 230 Cost of raising funds 208 578 513 2,686 192 4,177 780 4,957

Residential Care Homes - 1,615 1,435 2,377 534 5,961 - 5,961 Welfare Break Centres - 308 274 454 102 1,138 - 1,138 Care - 1,923 1,709 2,831 636 7, 0 9 9 - 7, 0 9 9 Personnel Recovery Centres - 9 8 13 3 33 - 33 Information, advice 752 953 847 4,439 315 7, 3 0 6 534 7, 8 4 0 and support Welfare cost in branches, 22 28 25 132 9 216 1 217 counties and districts Community welfare 774 981 872 4,571 324 7, 52 2 535 8,057 Central membership support 112 143 127 665 47 1,094 - 1,094 Recruitment, development, 15 18 16 85 6 140 - 140 training Support to branches with clubs 7 8 8 39 3 65 - 65 Membership costs in branches, ------counties and districts Membership 134 169 151 789 56 1,299 - 1,299 Comradeship 9 11 10 51 4 85 - 85 Direct cost of communications 131 165 147 771 55 1,269 - 1,269 and campaigning Communications and campaigning 131 165 147 771 55 1,269 - 1,269 Ceremonial and 22 28 25 129 9 213 54 267 commemorative events Remembrance tours 3 4 4 20 1 32 - 32 NMA operating costs ------1,422 1,422 Remembrance and ceremonial 25 32 29 149 10 245 1,476 1,721

Charitable activities 1,073 3,290 2,926 9,175 1,088 17, 552 2,011 19,563

Total support costs 1,281 3,868 3,439 11,861 1,280 21,729 2,791 24,520

Support costs are allocated on the basis of FTE staff numbers. Support costs associated with the awarding of grants to individuals and organisations are included within information, advice and support above.

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13 Support costs continued Head Office Facilities Human Finance Governance Total Subsidiaries Total Central Management Resources and IT 2018 Charity 2018 Group 2018 2018 2018 2018 £’000 2018 £’000 2018 £’000 £’000 £’000 £’000 £’000 £’000

Donations costs 112 107 81 443 39 782 511 1,293 Legacies costs 45 43 33 177 15 313 9 322 Poppy Appeal costs - 355 270 1,469 126 2,220 193 2,413 Fundraising events costs 60 57 44 238 20 419 18 437 Fundraising lotteries costs 35 33 25 137 12 242 - 242 Cost of raising funds 252 595 453 2,464 212 3,976 731 4,707

Residential Care Homes - 1,613 1,226 2,070 574 5,483 - 5,483 Welfare Break Centres - 353 268 453 125 1,199 - 1,199 Care - 1,966 1,494 2,523 699 6,682 - 6,682 Personnel Recovery Centres - 7 5 9 2 23 - 23 Information, advice and support 1,094 1,042 791 4,314 370 7, 611 462 8,073 Welfare cost in branches, 38 36 28 150 13 265 11 276 counties and districts Community welfare 1,132 1,078 819 4,464 383 7, 8 76 473 8,349 Central membership support 170 162 123 671 58 1,184 45 1,229 Recruitment, development, 21 20 15 82 7 145 - 145 training Support to branches with clubs 10 9 7 40 3 69 - 69 Membership costs in branches, ------counties and districts Membership 201 191 145 793 68 1,398 45 1,443 Comradeship 13 13 10 52 4 92 - 92 Direct cost of communications 174 165 125 684 59 1,207 - 1,207 and campaigning Communications and campaigning 174 165 125 684 59 1,207 - 1,207 Ceremonial and 28 27 20 111 10 196 36 232 commemorative events Remembrance tours 5 5 4 20 1 35 - 35 NMA operating costs ------958 958 Remembrance and ceremonial 33 32 24 131 11 231 994 1,225

Charitable activities 1,553 3,452 2,622 8,656 1,226 17,509 1,512 19,021

Total support costs 1,805 4,047 3,075 11,120 1,438 21,485 2,243 23,728

Support costs are allocated on the basis of FTE staff numbers. Support costs associated with the awarding of grants to individuals and organisations are included within information, advice and support above.

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14 Activities of consolidated subsidiaries and organisations The Legion has 13 wholly owned subsidiaries, nine of which are consolidated into these accounts as described below. There are a further four subsidiaries that are dormant.

The results of the subsidiary entities are shown in the table below. All subsidiaries have 30 September year-ends and are registered in the UK, with the exception of Royal British Legion Republic of Ireland (registered in the Republic of Ireland).

The National NMA Poppyscotland Royal British Royal British Royal British Royal British Remembrance Memorial (Enterprises) Group Legion Legion Trading Legion Poppy Legion Travel Arboretum 2019 2019 Republic of 2019 Lottery Developments 2019 Company £’000 £’000 Ireland £’000 2019 2019 £’000 2019 2019 £’000 £’000 £’000 £’000

Turnover/incoming 3,375 2,789 8,888 210 8,916 6,176 72 1 resources Expenditure (4,142) (2,806) (8,304) (263) (8,271) (6,176) (80) (33) Net incoming/(outgoing) (767) (17) 584 (53) 645 - (8) (32) resources Assets 23,367 503 16,181 2,673 4,563 3,849 151 55 Liabilities (807) (396) (2,295) (60) (828) (3,849) (163) (48) Net assets 22,560 107 13,886 2,613 3,735 - (12) 7

The National NMA Poppyscotland Royal British Royal British Royal British Royal British Remembrance Memorial (Enterprises) Group Legion Legion Trading Legion Poppy Legion Travel Arboretum 2018 2018 Republic of 2018 Lottery Developments 2018 Company £’000 £’000 Ireland £’000 2018 2018 £’000 2018 2018 £’000 £’000 £’000 £’000 Turnover/incoming 10,641 2,556 10,038 199 8,366 6,141 217 43 resources Expenditure (4,423) (2,560) ( 7, 7 01) (240) (9,251) (6,141) (219) (51) Net incoming/(outgoing) 6,218 (4) 2,337 (41) (885) - (2) (8) resources Assets 24,407 579 15,417 2,718 3,933 4,887 371 144 Liabilities (1,080) (455) (2,113) (35) (843) (4,887) (377) (104) Net assets 23,327 124 13,304 2,683 3,090 - (6) 40

The principal activities of the subsidiaries are to manufacture poppies and wreaths and to Legion of £2.4 million (2018: £3.9 million). as follows: provide framing and printing services. The Other lottery activities are carried out by the • Th e National Memorial Arboretum Company results above are those of the consolidated parent charity. Limited – a charitable company operating an Poppyscotland Group. • R oyal British Legion Developments Limited arboretum with memorial plots dedicated to those • R oyal British Legion Republic of Ireland – a trading company that develops or improves who suffered or lost their lives in the service of – a charitable company that supports those in properties, principally those owned by the their country. need who have served in the Armed Forces and Legion. There were no profits to pay to the • N MA (Enterprises) Limited – a trading company their dependants in the Republic of Ireland. Legion in 2019 or 2018. providing services to visitors to The National • R oyal British Legion Trading Limited – a trading • R emembrance Travel Limited – a dormant Memorial Arboretum Company Limited. Its company that markets a range of goods and subsidiary from 1 October 2018. Previously expenditure includes prior-year profits paid services to members and supporters of the a travel company delivering pilgrimages and under the Gift Aid scheme to The National Legion, and generates income from third parties associated travel activity. Its expenditure includes Memorial Arboretum Company Limited of through the use of corporate partnerships. Its prior-year profits paid under the Gift Aid scheme £664,000 (2018: £563,000). expenditure includes prior-year profits paid to the Legion of £30,000 (2018: £38,000). • P oppyscotland (Earl Haig Fund Scotland) under the Gift Aid scheme to the Legion of • RBL Financial Grants Raffle Limited, RBL Services – a charitable company that supports those in £3.09 million (2018: £3.975 million). Lottery Limited, Royal British Legion Family and need who have served in the Armed Forces and • R oyal British Legion Poppy Lottery Limited Support Lottery Limited and Poppy Travel Limited their dependants in Scotland. The charitable – a charitable company that undertakes the – dormant subsidiaries. company has one subsidiary, Lady Haig Poppy marketing and provision of a weekly lottery Factory Limited, whose principal activity is the to members and supporters of the Legion. Its employment of disabled ex-Service personnel expenditure includes a grant awarded to the

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15 Information regarding employees and trustees Total 2019 Total 2018 Average number of employees (full-time equivalent) during the year No. No. Raising funds 204 188 Charitable activities Care services and Personnel Recovery Centres 683 625 Community welfare services 347 341 Membership services 60 61 Comradeship 4 4 Communication and campaigning 59 52 Remembrance and ceremonial 11 10 Total charitable activities 1,164 1,093 Support and governance 143 121 Total charity full-time equivalent staff 1,511 1,402 Subsidiaries average number of employees (full-time equivalent) during the year Poppyscotland Group 101 90 National Memorial Arboretum Group 88 85 Royal British Legion Trading 8 9 Total group full-time equivalent staff 1,708 1,586

The group incurred costs of £5.0 million (2018: £8.098 million) on agency staff, which are not included in the staff costs below.

Group Group Charity Charity Staff costs comprise: 2019 2018 2019 2018 £’000 £’000 £’000 £’000

Wages and salaries 47,9 2 4 42,683 43,632 38,929 National Insurance contributions 4,568 3,991 4,217 3,668 Pension costs 4,559 3,729 4,167 3,271 Total staff costs 57, 0 51 50,403 52,016 45,868 The number of staff paid more than £60,000 during the year (salary plus taxable benefits, excluding pension contributions) was: Group Group Charity Charity 2019 2018 2019 2018 No. No. No. No.

£60,000 - £69,999 15 11 14 11 £70,000 - £79,999 14 15 14 15 £80,000 - £89,999 7 2 5 1 £90,000 - £99,999 1 1 1 1 £100,000 - £109,999 1 3 1 3 £110,000 - £119,999 1 1 1 - £120,000 - £129,999 3 3 3 3 £130,000 - £139,999 - - - - £140,000 - £149,999 1 2 1 2

The key management personnel of the group comprise the members of the parent During the year, the total expenses paid in respect of 13 (2018: 16) Board charity’s Executive Board. The total remuneration (including pension contributions of Trustee members amounted to £60,000 (2018: £67,000). This principally and employer’s National Insurance contributions) paid in respect of key represents travelling expenses for attending meetings and official engagements, management personnel for the year was £1.042 million (2018: £1.200 million). and includes the costs of trustees officiating at Remembrance tours. The Legion has purchased insurance to protect the charity from loss arising from neglect or The Legion operates a transparent Pay Policy, which is communicated to all staff. default of its trustees, and to indemnify the trustees against the consequences of Salary levels are regularly benchmarked against other comparable organisations neglect or default on their part. No trustee or person related or connected by across the private, public and third sectors. The compensation of Legion Directors business to them has received any remuneration from the Legion, nor have they is subject to annual review by a Governance Committee comprising four trustees, entered into any other transaction or contract with the Legion during the year. including the Chairman and Vice-Chairman.

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16 Staff pension funds

The Royal British Legion group pension arrangements comprise those of the Legion DB Fund: This is a multi-employer defined-benefit scheme. The other employers and its subsidiaries. The pension schemes are as follows: participating in the scheme are Royal British Legion Industries and the Royal British 1. Group Flexible Retirement Plan (GFRP) Legion Poppy Factory. The DB Fund was closed to new members on 31 October 2. The Earl Haig Fund Scotland – Stakeholder Scheme (EH Scheme) 2002 and on 1 April 2010 was closed to accrual from the remaining members. 3. The Lady Haig Poppy Factory – Stakeholder Scheme (LHPF Scheme) The most recent formal actuarial valuation was carried out as at 1 April 2017. The 4. The Royal British Legion Staff Pension Fund (DB Fund) results of this valuation have been updated to 30 September 2019 by a qualified 5. Stanplan F (Earl Haig Fund, ‘EH Fund’) actuary. In accordance with the current Schedule of Contributions, the Legion is not required to pay any ongoing deficit contributions into the Fund. Contributions GFRP: This is the scheme available to all Legion group employees (excluding are made in relation to administrative costs. Poppyscotland) and is provided by Standard Life. The GFRP scheme was introduced on 1 April 2010 and is a defined-contribution scheme. The liability of EH Fund: This is a defined-benefit pension scheme available only to employees of the employer is limited to the contributions it makes, which amounted to £4.249 Poppyscotland. The EH Fund was closed to new members on 31 October 2002 million (2018: £3.417 million), of which £384,000 (2018: £380,000) remained and on 31 March 2018 was closed to accrual from the remaining members. The payable at the year-end. last full actuarial valuation of the EH Fund was carried out as at 31 March 2016. As a result of the 2016 triennial valuation, the employer agreed to pay a one-off EH Scheme: This is a scheme available to employees of the Poppyscotland Group deficit contribution of £100,000, followed by annual deficit contributions of and is provided by Standard Life. The EH Scheme was introduced in July 2002 £75,000 per year from 1 July 2017 for eight years, increasing by 3% annually. and is a defined-contribution scheme. The liability of the employer is limited to the The Poppyscotland pension scheme is included in restricted funds. contributions it makes, which amounted to £159,000 (2018: £192,000), of which £28,000 (2018: £23,000) remained payable at the year-end. The Legion accounts for defined-benefit schemes in accordance with section 28 of FRS 102 (Employee Benefits) and identifies each entity’s share of the pension LHPF Scheme: This is the scheme available to employees of the Lady Haig scheme assets and liabilities. A summary of the movement in pension assets and Poppy Factory and is provided by Standard Life. The LHPF Scheme is a defined- liabilities for the group’s defined-benefit pension funds is shown below. contribution scheme, and the liability of the employer is limited to the contributions it makes, which amounted to £38,000 (2018: £20,000), of which £nil (2018: £6,000) remained payable at the year-end.

16a Amounts recognised in the Statement of Financial Activities EH Fund DB Fund Total EH Fund DB Fund Total 2019 2019 2019 2018 2018 2018 £’000 £’000 £’000 £’000 £’000 £’000 Current service cost (21) (549) (570) (33) - (33) Administration expenses (82) (660) (742) (106) (439) (545) Net interest (48) (71) (119) (49) (113) (162) Amount charged to net incoming resources (151) (1,280) (1,431) (188) (552) (740) Actuarial gains (541) (6,674) ( 7, 215) 203 2,360 2,563 Return on assets excluding amount included in net interest 500 5,228 5,728 (12) (94) (106) Amount recognised in other comprehensive income (41) (1,446) (1,487) 191 2,266 2,457 Total increase/(decrease) in net funds (192) (2,726) (2,918) 3 1,714 1,717

16b Reconciliation to the Balance Sheet EH Fund DB Fund Total EH Fund DB Fund Total 2019 2019 2019 2018 2018 2018 £’000 £’000 £’000 £’000 £’000 £’000 Market value of assets 5,603 71,050 76,653 5,255 68,151 73,406 Present value of defined-benefit obligation (7,414) (75,872) (83,286) (7,002) (70,472) (77,474) Pension liability recognised in the Balance Sheet (1,811) (4,822) (6,633) (1,747) (2,321) (4,068)

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16c Analysis of changes in the value of the fund liabilities over the year EH Fund DB Fund Total EH Fund DB Fund Total 2019 2019 2019 2018 2018 2018 £’000 £’000 £’000 £’000 £’000 £’000 Value of liabilities at start of year (7,002) (70,472) (77,474) (7,455) (73,810) (81,265) Current service costs (21) (549) (570) (33) - (33) Interest cost (191) (1,921) (2,112) (188) (1,882) (2,070) Member contributions - - - (5) - (5) Benefits paid 341 3,744 4,085 476 2,860 3,336 Actuarial gains (541) (6,674) (7,215) 203 2,360 2,563 Value of liabilities at end of year ( 7, 414 ) (75,872) (83,286) (7,002) (70,472) (77,474)

16d Analysis of changes in the value of the fund assets over the year EH Fund DB Fund Total EH Fund DB Fund Total 2019 2019 2019 2018 2018 2018 £’000 £’000 £’000 £’000 £’000 £’000 Market value of assets at start of year 5,255 68,151 73,406 5,541 69,547 75,088 Return on assets excluding amount included in net interest 500 5,228 5,728 (12) (94) (106) Administration expenses (82) (660) (742) (106) (439) (545)

Employer contributions 128 225 353 164 228 392 Interest income 143 1,850 1,993 139 1,769 1,908 Member contributions - - - 5 - 5

Benefits paid (341) (3,744) (4,085) (476) (2,860) (3,336) Market value of assets at end of year 5,603 71,050 76,653 5,255 68,151 73,406

16e Asset classes DB Fund 2019 DB Fund 2018 Market Value % Market Value % £’000 of total fund assets £’000 of total fund assets Equities 19,525 27% 18,549 27% Bonds 10,235 14% 10,613 16% Gilts - 0% 10,444 15% LDI 13,545 19%

Cash 754 1% 344 1% Annuities 1,901 3% 2,247 3% Other assets 25,090 35% 25,954 38% Total fund assets 71,050 68,151 The actual return on assets over the year was 7, 078 1,675

EH Fund 2019 EH Fund 2018 Market Value % Market Value % £’000 of total fund assets £’000 of total fund assets Equities 2,441 44% 2,363 45% Net current assets 15 0% 50 1% Annuities 500 9% 560 11% Other assets 2,647 47% 2,282 43% Total fund assets 5,603 5,255 The actual return on assets over the year was 643 127

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The Legion’s assets have been taken as the proportion of the total fund assets that the Legion’s liability valuation bears to the total fund’s liability valuation. The assets are invested in a diversified portfolio. During 2019, contributions of £225,000 and £130,000 are expected to be paid into the DB Fund and EH Fund respectively.

16f Actuarial assumptions Financial assumptions (both funds) 2019 2018 % p.a. % p.a.

Discount rate 1.7 2.8 Retail price index inflation 3.2 3.3 Consumer price index inflation 2.2 2.3 Salary increases 3.2 3.3 Rate of increases of pensions in payment: Capped at 5% or RPI if less 3.1 3.2 Capped at 5% or CPI if less 3.2 3.2 Capped at 3% or CPI if less 2.0 2.1

Capped at 2.5% or CPI if less 1.8 1.9 Rate of increase for deferred pensioners 2.2 2.3

Mortality assumptions (both funds) 2019 2018 Life expectancies at age 60: Males Females Males Females

Current pensioner now aged 60 26.4 years 28.9 years 27.5 years 29.5 years

Future pensioner now aged 40 27.9 y e a r s 30.4 years 29.0 years 31.1 years

17 Intangible fixed assets Software, Assets under Total Group Databases construction and Charity and Licences £’000 £’000 £’000 At cost or valuation At 1 October 2018 3,474 1,235 4,709 Additions 321 901 1,222 Transfers - - - At 30 September 2019 3,795 2,136 5,931

Accumulated amortisation At 1 October 2018 (1,044) - (1,044) Charge for the year (695) - (695) At 30 September 2019 (1,739) - (1,739)

Net book value at 30 September 2019 2,056 2,136 4,192 Net book value at 30 September 2018 2,430 1,235 3,665

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18 Group tangible fixed assets including functional property Freehold Other Leasehold Plant, Assets under Total homes freehold property and machinery construction Group £’000 £’000 leasehold and equipment £’000 £’000 improvements £’000 £’000 At cost or valuation At 1 October 2018 60,652 2 7, 519 29,827 4,816 2,529 125,343 Additions - 55 - 384 6,246 6,685 Transfers - 2,558 1,230 788 (4,576) - Disposals - (8) (88) - - (96) At 30 September 2019 60,652 30,124 30,969 5,988 4,199 131,932

Accumulated depreciation At 1 October 2018 (15,653) (5,696) (5,399) (3,803) - (30,551) Charge for the year (1,102) (454) (1,256) (448) - (3,260) Transfers ------Disposals - 2 65 - - 67 At 30 September 2019 (16,755) (6,148) (6,590) (4,251) - (33,744)

Net book value at 30 September 2019 43,897 23,976 24,379 1,737 4,199 98,188 Net book value at 30 September 2018 44,999 21,823 24,428 1,013 2,529 94,792

18a Charity tangible fixed assets including functional property Freehold Other Leasehold Plant, Assets under Total homes freehold property and machinery construction Charity £’000 £’000 leasehold and equipment £’000 £’000 improvements £’000 £’000 At cost or valuation At 1 October 2018 60,652 26,653 6,875 4,370 1,971 100,521 Additions - 5 5 - - 5,479 5,534 Transfers - 2,558 - 693 (3,251) - Disposals - (8) - - - (8) At 30 September 2019 60,652 29,258 6,875 5,063 4,199 106,047

Accumulated depreciation At 1 October 2018 (15,653) (5,378) (2,734) (3,725) - ( 2 7, 49 0 ) Charge for the year (1,102) (437) (672) (388) - (2,599) Transfers ------Disposals - 2 - - - 2 At 30 September 2019 (16,755) (5,813) (3,406) (4,113) - (30,087)

Net book value at 30 September 2019 43,897 23,445 3,469 950 4,199 75,960 Net book value at 30 September 2018 44,999 21,275 4,141 645 1,971 73,031

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19 Investments Group Group Charity Charity 2019 2018 2019 2018 £’000 £’000 £’000 £’000 Market value at 1 October 156,245 149,801 144,232 137,595 Net additions 2,100 3,312 1,259 3,512 Investment gain on revaluation 7, 55 0 3,082 7, 0 8 3 3,125 Market value at 30 September 165,895 156,195 152,574 144,232

The asset distribution of the investment portfolio at 30 September is presented below.

Group Group Charity Charity 2019 2018 2019 2018 £’000 £’000 £’000 £’000 Equities: UK 18,711 2 7,18 5 16,645 25,319 Overseas 40,611 28,415 36,554 24,887 Total equities 59,322 55,600 53,199 50,206

Bonds: UK 38,451 36,890 33,122 31,874 Overseas 3,729 3,322 3,698 3,288 Total bonds 42,180 40,212 36,820 35,162

Cash: UK 12,995 13,435 12,995 13,435 Overseas 582 214 - - Total cash 13,577 13,649 12,995 13,435

Hedge funds – UK 5,509 5,524 5,509 5,524

Commodities 1,932 - 1,932 -

Portfolio funds: UK 23,691 24,486 23,691 24,486 Overseas 96 103 - - Total portfolio funds 23,787 24,589 23,691 24,486

Other: UK 10,070 8,309 8,912 7,112 Overseas 9,518 8,312 9,516 8,307 Total other 19,588 16,621 18,428 15,419

Total investments 165,895 156,195 152,574 144,232

£136.143 million of the investments are managed by Cazenove Capital Management Limited (2018: £129.177 million). The strategy is to maintain the real value of assets and target an investment return of CPI plus 3 per cent. The investments are held at market value, normally using prices obtained from an independent pricing source. Funds and unit trusts are generally priced on a net asset value basis. Structured products are valued on a market to market basis. Unquoted investments are valued in accordance with the International Private Equity and Venture Capital valuation guidelines or held at cost. Investments where a price is not readily available, that are held in an execution-only portfolio, are valued at the last publicly available price.

Other investments includes investments held by branches, and balances relating to the Arthur Atock Memorial Trust and Devon Community Trust.

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20 Investment properties Group and Charity Group and Charity 2019 2018 £’000 £’000 Market value at 1 October 66,682 61,112 Transfers from tangible fixed assets - 15 Disposals at market value ( 7, 5 4 8 ) (4,877) Net gain on revaluation of investment properties 5,885 10,432 Market value at 30 September 65,019 66,682

Investment properties primarily comprise 310 properties (2018: 330 properties), which are owned by the Legion but are let to independent commercial operations, primarily affiliated social clubs. The Legion’s valuation methodology is to revalue its investment properties on a five-year rolling basis, with 20 per cent being revalued each year. For the year ended 30 September 2019, 82 properties were externally revalued (2018: 59 properties) and a revaluation gain of £2.35 million (2018: £2.951 million) was recognised in the accounts. This revaluation was completed by Bruton Knowles, a firm of qualified surveyors, on the basis of open-market value for existing use. The remaining 80 per cent of investment properties are reviewed internally by a qualified surveyor for any material changes on an annual basis, and as a result of this exercise, further revaluation losses totalling £8,000 (2018: gains of £4.096 million) have been recognised.

In 2017, following receipt of legal advice, a revaluation loss of £3.240 million was recognised on the basis of uncertainty about whether the Legion had a beneficial interest in a number of properties. During 2019, nine of these properties have transferred to the full corporate trusteeship of the Legion, and as a result, a revaluation gain of £475,000 (2018: £1.220 million) has been recognised in respect of these properties.

The remainder of the net gain on revaluation relates to gains on disposal of £3.067 million (2018: £2.165 million).

21 Programme-related investments Group Group Charity Charity 2019 2018 2019 2018 £’000 £’000 £’000 £’000 Loans to external organisations Sir Oswald Stoll Foundation 668 784 668 784 Other schemes unrestricted Loans for property repairs (PRL) 4,337 4,787 4,337 4,787 Programme-related investments unrestricted 5,005 5,571 5,005 5,571 Other schemes restricted Be The Boss scheme (BTB) 3 17 3 17 Group loans - - - 23 Total programme-related investments 5,008 5,588 5,008 5,611

21a Programme-related investments movement during the year Sir Oswald PRL BTB Total Group Total Stoll loans loans Group loans Charity Foundation £’000 £’000 £’000 £’000 £’000 £’000

Opening balance at 1 October 2018 784 4,787 17 5,588 23 5,611 Interest 24 - - 24 - 24 Repayments and security deposits (140) (450) (6) (596) (23) (619) Write-offs and bad-debt provision movements - - (8) (8) - (8) Closing balance at 30 September 2019 668 4,337 3 5,008 - 5,008

The Legion has provided a number of loans in furtherance of its charitable objectives as follows:

Sir Oswald Stoll Foundation – a secured loan repayable over 10 years issued towards the development costs of a veterans’ housing centre. An interest rate of 4 per cent is applied to the principal issued on the anniversary of the loan agreement (17 September 2013).

Property Repair Loans – interest-free secured loans to beneficiaries living in their own homes to provide housing improvements. The majority are lifetime loans as they are repayable on the sale of property. The minimum amount for a loan is £2,000 and the maximum allowed is £25,000. The Legion ceased issuing new loans in 2013.

Be the Boss loans – a scheme (now closed) originally supported by the Ministry of Defence, which provides financial support through loans and grants to recent UK Service leavers who are interested in setting up or expanding their own business. The loans are repayable within four years and an annual rate of interest of 9.4 per cent is charged.

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22 Debtors

Group Group Charity Charity 2019 2018 2019 2018 £’000 £’000 £’000 £’000

Trade debtors 7, 6 3 3 5,421 7, 319 5,269 Amounts due from consolidated entities - - 2,914 4,645 Other debtors 3,110 3,005 2,957 2,807 Prepayments and accrued income 5,986 6,690 4,851 5,069 Total debtors 16,729 15,116 18,041 17, 7 9 0

23 Cash at hand and in bank and short-term deposits Group Group Charity Charity 2019 2018 2019 2018 £’000 £’000 £’000 £’000 Cash held centrally Short-term deposits 10,075 2 7, 5 7 9 9,592 2 7, 0 9 6 Cash at hand and in bank 36,946 26,859 26,212 13,202 47, 0 21 54,438 35,804 40,298

Cash held by branches 12,210 13,315 12,210 13,315 Total cash 59,231 6 7, 75 3 48,014 53,613

24 Creditors Group Group Charity Charity 2019 2018 2019 2018 £’000 £’000 £’000 £’000

Creditors falling due within one year Trade creditors 5,576 4,218 4,792 3,261 Amounts due to consolidated entities - - 204 255 Grant commitments (see note 25) 11,288 9,216 11,288 9,191 Accruals 10,521 11,8 58 9,011 10,820 Deferred Income 3,050 3,001 2,256 2,304 Other creditors 2,084 3,174 1,831 3,042 Total creditors falling due within one year 32,519 31,467 29,382 28,873

Group Group Charity Charity 2019 2018 2019 2018 £’000 £’000 £’000 £’000

Creditors falling due after more than one year External grant commitments (see note 25): Due within two to five years 5,201 9,832 5,201 9,832 Total creditors falling due after more than one year 5,201 9,832 5,201 9,832

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25 Group grant commitments Personnel Centre for Blast Other Group Total Recovery Injury Studies 2019 2019 Centres 2019 £’000 £’000 2019 £’000 £’000 Opening balance at 1 October 9,627 2,901 6,520 19,048 Grants awarded - - 11,8 49 11,8 49 Unwinding of discount 204 (34) (33) 137 Payments during the year (2,581) (1,000) (10,964) (14,545) Closing balance at 30 September 7,250 1,867 7, 372 16,489

25a Charity grant commitments Personnel Centre for Blast Other Charity Total Recovery Injury Studies 2019 2019 Centres 2019 £’000 £’000 2019 £’000 £’000 Opening balance at 1 October 9,627 2,901 6,495 19,023 Grants awarded - - 11,8 49 11,8 49 Unwinding of discount 204 (34) (33) 137 Payments during the year (2,581) (1,000) (10,939) (14,520) Closing balance at 30 September 7,250 1,867 7, 372 16,489

26 Provisions for liabilities Group Group Charity Charity 2019 2018 2019 2018 £’000 £’000 £’000 £’000 Opening balance at 1 October 487 619 487 619 Provisions written back in year 7 (132) 7 (132) Closing balance at 30 September 494 487 494 487

27 Group operating lease commitments Land and Vehicles and Land and Vehicles and buildings equipment buildings equipment 2019 2019 2018 2018 £’000 £’000 £’000 £’000

At 30 September, the group had annual commitments under non-cancellable operating leases as follows: Within one year 1,285 608 1,362 595 Within two to five years 4,575 812 4,838 1,194 Over five years 2,750 - 3,869 - Total 8,610 1,420 10,069 1,789

27a Charity operating lease commitments Land and Vehicles and Land and Vehicles and buildings equipment buildings equipment 2019 2019 2018 2018 £’000 £’000 £’000 £’000

At 30 September, the charity had annual commitments under non-cancellable operating leases as follows: Within one year 1,230 585 1,317 574 Within two to five years 4,389 766 4,595 1,169 Over five years 2,661 - 3,705 - Total 8,280 1,351 9,617 1,743

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28 Group unrestricted funds Opening Incoming Resources Gains/(losses) Transfers Closing Balance resources expended £’000 £’000 Balance 1 Oct 2018 £’000 £’000 30 Sept 2019 £’000 £’000

Central benevolent fund 29,720 112,120 (121,582) 5,453 2,7 74 28,485 Area trust funds 3 7,181 - - - 2,113 39,294 Pension reserve (2,321) - (1,280) (1,446) 225 (4,822) Subsidiaries' funds 3,118 14,950 (9,065) - (5,273) 3,730 Available reserves* 67, 69 8 12 7, 070 (131,927) 4,007 (161) 66,687

General fund 4,706 4,713 (4,232) - - 5,187 Branch, county, district and Women's Section funds 28,977 6,702 (4,158) 311 62 31,894 Functional fixed asset reserve 76,696 - (3,292) - 6,748 80,152 Programme-related investment reserve 5,571 29 - - (686) 4,914 Total group unrestricted funds 183,648 138,514 (143,609) 4,318 (5,963) 188,834

Opening Incoming Resources Gains/(losses) Transfers Closing Balance resources expended £’000 £’000 Balance 1 Oct 2017 £’000 £’000 30 Sept 2018 £’000 £’000

Central benevolent fund 31,279 114,705 (116,944) 1,719 (1,039) 29,720 Area trust funds 36,675 - (244) - 750 37,181 Subsidiaries' funds 4,009 14,415 ( 7, 7 2 7 ) - ( 7, 5 7 9 ) 3,118 Available reserves* 71,963 129,120 (124,915) 1,719 (7,868) 70,019 General fund 4,097 4,929 (4,242) - (78) 4,706 Branch, county, district and Women's Section funds 31,740 2,850 (3,667) 230 (2,176) 28,977 Functional fixed asset reserve 76,670 - (3,231) - 3,257 76,696 Programme-related investment reserve 6,089 33 - - (551) 5,571 Pension reserve (4,263) - (646) 2,360 228 (2,321) Total group unrestricted funds 186,296 136,932 (136,701) 4,309 (7,188) 183,648

* The definition of “available reserves” used by RBL has been amended to include the Pension reserve in 2019

The Central benevolent fund incorporates the core activities of the Legion, such as operating residential Care Homes and welfare Break Centres, giving grants, providing resettlement training, giving pension-claims advice and acting as the custodian of Remembrance. The proceeds from the annual Poppy Appeal collection are allocated to this fund.

The Area trust funds are benevolent funds that have been designated for use in a particular geographical area.

Subsidiaries’ funds represents unrestricted funds held in subsidiaries.

Taken together, the above three lines represent the total unrestricted reserves of the Legion, which are available for immediate use at the discretion of the trustees.

The General fund is used to support the central administration of the membership of the Legion.

Branch, county, district and Women’s Section funds represent those funds held by, or on behalf of, the various Legion membership formations.

The Functional fixed asset reserve represents the value of the Legion’s functional fixed asset portfolio (such as residential Care Homes and welfare Break Centres), used by the charity in the delivery of its charitable objectives.

The Programme-related investment reserve represents the value of the programme-related investments used by the charity in the delivery of its charitable objectives. The unrestricted reserve excludes Be The Boss loans, which are included within restricted funds (see note 29).

The Pension reserve is a specific allocation of unrestricted funds in relation to the Royal British Legion Staff Pension Fund.

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28a Charity unrestricted funds Opening Incoming Resources Gains/(losses) Transfers Closing Balance resources expended £’000 £’000 Balance 1 Oct 2018 £’000 £’000 30 Sept 2019 £’000 £’000

Central benevolent fund 29,720 117, 616 (124,111) 5,452 (192) 28,485 Area trust funds 3 7,181 - - - 2,113 39,294 Pension reserve (2,321) - (1,280) (1,446) 225 (4,822) Available reserves* 64,580 117, 616 (125,391) 4,006 2,146 62,957 General fund 4,706 4,713 (4,232) - - 5,187 Branch, county, district and Women's Section funds 28,977 6,702 (4,158) 311 62 31,894 Functional fixed asset reserve 76,696 - (3,292) - 6,748 80,152 Programme-related investment reserve 5,571 29 - - (686) 4,914 Total charity unrestricted funds 180,530 129,060 (137, 073 ) 4,317 8,270 185,104

Opening Incoming Resources Gains/(losses) Transfers Closing Balance resources expended £’000 £’000 Balance 1 Oct 2017 £’000 £’000 30 Sept 2018 £’000 £’000

Central benevolent fund 31,279 122,641 (125,792) 1,719 (127) 29,720 Area trust funds 36,675 - (244) - 750 37,181 Available reserves* 67,954 122,641 (126,036) 1,719 623 66,901 General fund 4,097 4,929 (4,242) - (78) 4,706 Branch, county, district and Women's Section funds 31,740 2,850 (3,667) 230 (2,176) 28,977 Functional fixed asset reserve 76,670 - (3,231) - 3,257 76,696 Programme-related investment reserve 6,089 33 - - (551) 5,571 Pension reserve (4,263) - (646) 2,360 228 (2,321) Total charity unrestricted funds 182,287 130,453 (137,822) 4,309 1,303 180,530

* The definition of “available reserves” used by RBL has been amended to include the Pension reserve in 2019

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29 Group restricted funds

Opening Incoming Resources Gains/ Transfers Closing Balance resources expended (losses) £’000 Balance 1 Oct 2018 £’000 £’000 £’000 30 Sept 2019 £’000 £’000 Investment property reserve 66,682 - - 5,885 (7,548) 65,019 Income and sales proceeds from property held in 45,758 2,749 (3,491) 363 1,472 46,851 corporate trusteeship Grants for specific purposes 4,829 19,227 ( 17, 5 6 5 ) - (1,976) 4,515 Programme-related investment reserve 17 - - - (14) 3 Donor-restricted legacies and donations 13,233 1,156 (378) 116 (204) 13,923 Branch and county funds 6,496 883 (324) 670 - 7, 72 5 Charity Commission schemes 1,933 46 - 134 - 2,113 Homes’ residents’ amenity funds 1,030 719 (690) - - 1,059 The Arthur Atock Memorial Trust 1,201 267 (185) (4) - 1,279 British Korean Veterans (1981) Relief Fund 149 3 (3) 3 - 152 Samsung British Korean Veterans Scholarship Fund 429 10 (116) 13 - 336 Permanent endowments 824 15 (34) 25 - 830 Total charity restricted funds 142,581 25,075 (22,786) 7, 2 0 5 (8,270) 143,805 Poppyscotland Group 15,050 7, 8 7 1 (8,744) 484 1,019 15,680 Poppyscotland pension provision (1,747 ) - - (41) - (1,788) National Memorial Arboretum Group 23,425 4,213 (6,283) - 1,288 22,643 Royal British Legion Republic of Ireland 2,683 212 (262) 1 - 2,634 Total group restricted funds 181,992 37,371 (38,075) 7, 6 49 (5,963) 182,974

Opening Incoming Resources Gains/ Transfers Closing Balance resources expended (losses) £’000 Balance 1 Oct 2017 £’000 £’000 £’000 30 Sept 2018 £’000 £’000 Investment property reserve 61,112 - - 10,432 (4,862) 66,682 Income and sales proceeds from property held in 44,533 2,354 (5,150) 412 3,609 45,758 corporate trusteeship Grants for specific purposes 4,715 7,9 8 6 ( 7,9 3 2 ) - 60 4,829 Programme-related investment reserve 77 - - - (60) 17 Donor-restricted legacies and donations 12,985 617 (249) 129 (249) 13,233 Branch and county funds 5,750 529 (207) 464 (40) 6,496 Charity Commission schemes 1,762 52 - 119 - 1,933 Homes’ residents’ amenity funds 973 632 (810) - 235 1,030 The Arthur Atock Memorial Trust 1,247 47 (65) (28) - 1,201 British Korean Veterans (1981) Relief Fund 155 2 (11) (2) 5 149 Samsung British Korean Veterans Scholarship Fund 429 11 - (11) - 429 Permanent endowments 847 16 (37) (1) (1) 824 Total charity restricted funds 134,585 12,246 (14,461) 11, 514 (1,303) 142,581 Poppyscotland Group 12,879 8,448 (7,653) (19) 1,395 15,050 Poppyscotland pension provision (1,914) - (24) 191 - (1,747 ) National Memorial Arboretum Group 17, 214 5,353 (6,238) - 7, 0 9 6 23,425 Royal British Legion Republic of Ireland 2,724 199 (216) (24) - 2,683 Total group restricted funds 165,488 26,246 (28,592) 11,6 62 7,18 8 181,992

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29 Group restricted funds continued

Restricted funds represent grants, donations, legacies and property that are given by the donor for specific purposes and that must be used for that purpose. All restricted funds are held within the Benevolent fund. Restricted funds include permanent endowment funds that are not material and are not therefore shown separately on the face of the Balance Sheet.

The investment property reserve represents the estimated market value of £65.019 million (2018: £66.682 million), representing a portfolio of 310 properties (2018: 330 properties) owned by the Legion and, in most cases, occupied by social clubs licensed by the Legion to use its name. Many of these properties are held under trust deeds, which provide that, if they are sold, the proceeds must be applied in accordance with the terms of the original trust deeds. In most cases, the beneficiaries of such deeds will also be the beneficiaries of The Royal British Legion, but in some cases, the relevant deed may limit support in the first instance to ex-Serving personnel in a defined geographical area.

As a result, income from these properties is held as restricted funds pending agreement with the Charity Commission on how the restrictions contained within the trust deeds can be widened to best serve the Legion’s beneficiaries, at which point the funds are transferred to other reserves as appropriate. The value of these reserves at 30 September 2019 was £46.851 million (2018: £45.758 million), which includes both investment income and sales proceeds.

29a Charity restricted funds

Opening Incoming Resources Gains/ Transfers Closing Balance resources expended (losses) £’000 Balance 1 Oct 2018 £’000 £’000 £’000 30 Sept 2019 £’000 £’000 Investment property reserve 66,682 - - 5,885 (7,548) 65,019 Income and sales proceeds from property held in 45,758 2,749 (3,491) 363 1,472 46,851 corporate trusteeship Grants for specific purposes 4,829 19,227 ( 17, 5 6 5 ) - (1,976) 4,515 Programme-related investment reserve 17 - - - (14) 3 Donor-restricted legacies and donations 13,233 1,156 (378) 116 (204) 13,923 Branch and county funds 6,496 883 (324) 670 - 7, 72 5 Charity Commission schemes 1,933 46 - 134 - 2,113 Homes’ residents’ amenity funds 1,030 719 (690) - - 1,059 The Arthur Atock Memorial Trust 1,201 267 (185) (4) - 1,279 British Korean Veterans (1981) Relief Fund 149 3 (3) 3 - 152 Samsung British Korean Veterans Scholarship Fund 429 10 (116) 13 - 336 Permanent endowments 824 15 (34) 25 - 830 Total charity restricted funds 142,581 25,075 (22,786) 7,205 (8,270) 143,805

Opening Incoming Resources Gains/ Transfers Closing Balance resources expended (losses) £’000 Balance 1 Oct 2017 £’000 £’000 £’000 30 Sept 2018 £’000 £’000 Investment property reserve 61,112 - - 10,432 (4,862) 66,682 Income and sales proceeds from property held in 44,533 2,354 (5,150) 412 3,609 45,758 corporate trusteeship Grants for specific purposes 4,715 7,9 8 6 ( 7,9 3 2 ) - 60 4,829 Programme-related investment reserve 77 - - - (60) 17 Donor-restricted legacies and donations 12,985 617 (249) 129 (249) 13,233 Branch and county funds 5,750 529 (207) 464 (40) 6,496 Charity Commission schemes 1,762 52 - 119 - 1,933 Homes’ residents’ amenity funds 973 632 (810) - 235 1,030 The Arthur Atock Memorial Trust 1,247 47 (65) (28) - 1,201 British Korean Veterans (1981) Relief Fund 155 2 (11) (2) 5 149 Samsung British Korean Veterans Scholarship Fund 429 11 - (11) - 429 Permanent endowments 847 16 (37) (1) (1) 824 Total charity restricted funds 134,585 12,246 (14,461) 11,514 (1,303) 142,581

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30 Transfers between restricted and unrestricted funds During the year, the group made net transfers of £5.963 million from restricted to unrestricted reserves (2018: £7.188 million transferred from unrestricted to restricted reserves). The most significant transfers are described below.

The Legion carried out further work in respect of the income and sale proceeds held from properties in corporate trusteeship. In its role as corporate trustee, the Legion made use of provisos on 30 trusts (2018: 15 trusts) resulting in the release of £2.113 million (2018: £750,000) from restricted into unrestricted funds. The Legion has opted to designate these funds for welfare activity, and they are included within Area trust funds at note 28 above.

An amount of £1.192 million (2018: £6.999 million) was transferred from unrestricted to restricted funds in respect of grant funding provided by the charity to the National Memorial Arboretum. Similarly, a transfer of £1.019 million (2018: £1.395 million) was made from unrestricted to restricted funds in respect of funding provided by the charity to Poppyscotland.

31 Analysis of group net assets between funds Unrestricted funds Restricted funds Total Unrestricted funds Restricted funds Total 2019 2019 2019 2018 2018 2018 Fund balances are represented by £’000 £’000 £’000 £’000 £’000 £’000 Intangible and tangible assets 80,152 22,228 102,380 76,463 21,994 98,457 Investments 9 7, 8 4 4 138,078 235,922 93,034 135,431 228,465 Current assets 51,745 26,608 78,353 54,405 30,167 84,572 Current and non-current liabilities (36,085) (2,129) (38,214) ( 3 7,9 3 3 ) (3,853) (41,786) Defined-benefit pension liability (4,822) (1,811) (6,633) (2,321) (1,747 ) (4,068) Total funds 188,834 182,974 371,808 183,648 181,992 365,640

32 Events after the reporting period In early 2020, the existence of a new coronavirus, known as Covid-19, was confirmed. The virus spread from China, where it originated, to a significant number of other countries. Covid-19 has caused disruption to daily life and economic activity and is likely to lead to a global recession. We consider the emergence and spread of Covid-19 to be a non-adjusting post balance sheet event as at 30 September 2019. As set out in the Financial Review on p44, the trustees have considered the potential impact of the virus on the Legion’s income, expenditure, assets and liabilities, using different scenarios to assess the charity’s ability to continue as a going concern and meet its liabilities as they fall due. The trustees have concluded that the Legion remains a going concern and these accounts are therefore prepared on a going concern basis. The Covid-19 situation continues to evolve and given the inherent uncertainty, it is not practicable at this time to provide a financial estimate of the impact of Covid-19 on the group.

On 1 April 2020, the trade and assets of subsidiary company Royal British Legion Poppy Lottery Limited were transferred to The Royal British Legion. This transfer took place in order to satisfy requirements of the Gambling Commisssion (the regulator for lottery activities). From this date, the subsidiary company will become dormant and all lottery activities will be reported in the parent charity’s financial statements.

On 7 January 2020, Gift Aid totalling £3.735 million relating to the 2019 profits of Royal British Legion Trading was paid to the charity; consequently no tax is payable by this subsidiary in respect of the year ended 30 September 2019.

On 18 December 2019, Gift Aid of £107,000 relating to the 2019 profits of NMA (Enterprises) was paid to the National Memorial Arboretum Company, supplementing a further £540,000 paid on account during the financial year; consequently no tax is payable by NMA (Enterprises) in respect of the year ended 30 September 2019.

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33 Related party transactions During the year ended 30 September 2019, the following transactions have taken place between the charity and other members of the Legion group: • Grant funding of £1.165 million was provided by the charity to The National Memorial Arboretum Company (2018: £6.999 million). • The charity received donations of profits from Royal British Legion Trading and Remembrance Travel of £3.090 million and £30,000 respectively (2018: £3.975 million and £38,000 respectively). Royal British Legion Developments had no profits to pay to the charity in 2019 (2018: nil). • The charity received a grant of £2.376 million from Royal British Legion Poppy Lottery (2018: £3.923 million). • Grant funding of £1.019 million was provided by the charity to the Poppyscotland Group (2018: £1.395 million). • The charity recognised capital expenditure of £nil with Royal British Legion Developments (2018: £405,000). • The charity purchased goods and services valued at £71,000 from Royal British Legion Trading (2018: £139,000). • The charity purchased goods and services valued at £122,000 from NMA (Enterprises) (2018: £97,000) and £Nil from The National Memorial Arboretum Company (2018: £6,000). • At 30 September 2019, there was an outstanding loan balance of £nil owed to the charity by Remembrance Travel (2018: £23,000).

In addition, the following balances were outstanding between the charity and other members of the Legion group at 30 September 2019:

Charity Charity 2019 2018 Amounts receivable from consolidated entities £’000 £’000 Royal British Legion Poppy Lottery 2,554 4,148

The National Memorial Arboretum Company 142 131

Royal British Legion Developments 98 38

Royal British Legion Trading 92 281

NMA (Enterprises) 11 12

Remembrance Travel 2 35

Royal British Legion Republic of Ireland 15 -

Total amounts receivable from consolidated entities 2,914 4,645

Charity Charity 2019 2018 Amounts payable to consolidated entities £’000 £’000 Poppyscotland Group 204 139

Royal British Legion Republic of Ireland - 116

Total amounts payable to consolidated entities 204 255

The Royal British Legion is a member organisation of the Royal Commonwealth Ex-Services League (RCEL). Three of the Legion’s trustees hold positions within the RCEL as detailed below. The RCEL shares office space and certain services with the Legion, which had an estimated value of £47,000 during the year (2018: £51,000). The RCEL does not make payments to the Legion for these services.

In addition, on 7 September 2017, the trustees approved a grant to the RCEL of £1.2 million to be paid over a period of five years, commencing in 2018. In line with its policy of recognising future grant commitments at their net present value using an appropriate discount rate (see note 1), the charity recognised £25,000 of grant expenditure in relation to the RCEL during 2019 (2018: £68,000) and held a grant creditor of £646,000 owed to RCEL at 30 September 2019 (2018: £911,000).

Organisation Related party Position at the Legion Position at related party organisation Royal Commonwealth Terry Whittles Trustee Trustee Ex-Services League Major General David Jolliffe Trustee Honorary Medical Adviser Lieutenant Colonel Joe Falzon Trustee Council Member for Malta

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THE ROYAL BRITISH LEGION ANNUAL REPORT 2018 IBC AND OBC 210X297 84 The Royal British Legion, Haig House, 199 Borough High Street, London SE1 1AA T 020 3207 2100 E [email protected] W www.britishlegion.org.uk Registered Charity Number: 219279

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